Apple wins court ruling throwing out $308.5 million patent verdict
(Reuters) — Apple Inc convinced a federal judge that a verdict of $308.5 million it lost to a privately held licensing firm for infringing a digital rights management patent was invalid.
U.S. District Judge Rodney Gilstrap ruled that Personalized Media Communications LLC (PMC) intentionally delayed filing its U.S. Patent and Trademark Office application to receive a larger settlement.
“This court takes very seriously any prospect of disturbing the unanimous verdict a duly appointed jury,” Gilstrap wrote. However, PMC’s “deliberate stratagem of delay” was a “conscious egregious misuse of the statutory patent system.”
PMC, based in Sugar Land, Texas, claimed that the FairPlay software in Apple’s iTunes and App Store to decrypt movies and music infringed its 2012 patent.
Judge Marshall, Texas accepted Apple’s defense for “prosecution lacches,” which can prevent a patent holder from delaying enforcement of a patent. Gilstrap stated that PMC’s delay was long-lasting.
After a one-week trial, jurors found Cupertino-based Apple liable for PMC on March 19.
“PMC respectfully disagrees with Judge Gilstrap’s ruling and plans for appeal,” Douglas Kline, Goodwin Procter’s lawyer, stated in an email.
Apple has not yet responded to our requests for comment.
PMC’s patent application dates back to the 1980s applications.
Gilstrap stated that PMC used a “submarine” strategy to patent its technology. First, it filed serial applications, then kept its patent portfolio “hidden” until the industry adopted the underlying technology.
He stated that PMC would only demand licensing fees or allege infringement if it believes in widespread violation.
He cited an internal PMC document dated 1991 that identified Apple, IBM, Intel, Hewlett-Packard, and Microsoft as “natural choices” for its strategy.
Submarine patents were made more accessible by a June 1 ruling of the federal appeals court.