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Apple files yet another appeal against $503m FaceTime patent payout

Claims it redesigned around VirnetX IP. That obviously worked well then…

Apple has filed its fifth appeal against a half-billion award, claiming that it redesigned its FaceTime system to avoid infringing VirnetX’s network security patents.

The filing is particularly timely given the fact that on Monday Apple blocked group Facetime chats globally after a bonkers bug was revealed that let miscreants call you and secretly listen in to your iPhone, iPad, or Mac’s audio before you picked up via the app. A software fix is due to land this week.

Anyway, back in 2012, Apple was ordered to cough up $368m for infringing on four of VirnetX’s network protocol patents (US 7,418,504 and 7,921,211) with its FaceTime videoconferencing app and iMessage. Microsoft had previously been sued over the same patents and had agreed to pay $200m but Apple refused and went to great lengths to avoid the patents in question.

That included redesigning FaceTime to get around the offending patents, even cutting off some of its own users when they didn’t install a software update that changed how FaceTime worked. Apple claimed the lack of service was a bug when in fact it looks like a conscious decision to avoid the patents: the company is being sued by affected users over that one.

Cook & Co then embarked on a no-holds-barred legal challenge to VirnetX’s claims. It proceeded to lose its cases in court and appeals courts time and time again, each time with the damages rising.

In this latest appeal, Apple claims that that controversial redesign means that it shouldn’t have to pay VirnetX, claiming that the company misled the court and the jury in the subsequent case: “VirnetX then pivoted to claim construction and infringement theories that are unsupported by, and indeed inconsistent with, the patents and the evidence.”

It blames the judge too: “The district court nonetheless allowed VirnetX to parlay its improper theories into a judgment of nearly $600 million, while preventing Apple from fairly presenting its defenses to the jury.”

How exactly was Apple prevented from giving evidence in a jury trial? According to Apple, the judge “erroneously invoked issue preclusion to forbid Apple from presenting invalidity issues near previously adjudicated.”

As much lawyering as you can buy

If this all sounds like a lot of legal BS that’s because it is: Apple’s lawyers have clearly been given the order to fight this case to their dying breath and so every single possible avenue has been exhaustively explored. And when the judge has grown tired of it and shut it down, Apple has appealed claiming that judge didn’t give them a fair trial.

It lost an initial appeal in 2013 but appealed, getting the case sent back to the court. The court reviewed it and decided against Apple again – increasing the award to $625m. Apple did the same again and got another retrial. And lost again: $440m. And then did it again and lost again: $503m. And now it is trying again.

Remember when Apple’s FaceTime stopped working years ago? Yeah, that was deliberate


And if that fails, it has already lined up another appeal: questioning the method by which the judge calculated the $93.4m in interest that he ordered be added to the $503m award reached last year.

One thing you can’t fault Apple lawyers on is knowing how the play the system. Presumably, the idea is to drag the case out so long that VirnetX looks for some kind of way out, or runs out of money and folds. Apple’s appeal doc stretches to a hefty 474 pages [PDF].

Apple does put forward another argument however that may ultimately see it win the long-running case: that the patents have been ruled invalid by the US Patent and Trademark Office.

And indeed they have – after, that is, Apple embarked on a massive multi-year campaign to challenge them. It succeeded but, of course, VirnetX has appealed that ruling by the USPTO, and thanks to recent changes in the rules over software patents, VirnetX has a good chance of winning back its patents when its case is heard.

It remains speculation as to whether the technology that VirnetX has patented would have prevented this month’s dreadful FaceTime bug. Or if the company had spent less time trying to avoid paying another company for its intellectual property and more time focused on providing a secure product whether the situation would never have arisen.

Either way, this case is likely to drag on a few more years. As no doubt will the lawsuit brought against Apple by its users for cutting them off. And the inevitable lawsuits that will come from this latest security snafu. ®

source: The Register