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Federal appeals court throws out $368 million award in Apple patent dispute

[JURIST] The US Court of Appeals for the Federal Circuit [official website] on Tuesday overturned [opinion, PDF] an order requiring Apple [corporate website] to pay $368.2 million to VirnetX Holding Corp. in a patent dispute. The case was originally heard in the US District Court for the Eastern District of Texas, which found that Apple infringed upon VirnetX's patents for their virtual private network (VPN). VirnetX claimed [Reuters report] that Apple was illegally applying its VPN within the FaceTime application found on Apple's recent generation products. On appeal Apple was still found to be infringing on VirnetX's patent for VPN, but the court determined that the jury was improperly instructed on how to calculate the damages. Chief Justice Sharon Prost stated in the opinion, "[t]he law requires patentees to apportion the royalty down to a reasonable estimate of the value of its claimed technology, or else establish that its patented technology drove demand for the entire product." The case will be sent back to the district court for further proceedings to address the calculation of damages issue.

Apple has been facing ongoing patent disputes throughout the nation, especially with Samsung [corporate website]. Last month Apple and Samsung agreed to drop [JURIST report] all patent infringement lawsuits in courts outside of the US. In June Apple and Samsung also agreed to dismiss [JURIST report] their appeals of a patent infringement case at the US International Trade Commission [official website] that resulted in an import ban on some older model Samsung phones. In May a jury in the US District Court for the Northern District of California ordered [JURIST report] Samsung to pay $119.6 million to Apple for patent infringement.

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Paper Chase is JURIST's real-time legal news service, powered by a team of 30 law student reporters and editors led by law professor Bernard Hibbitts at the University of Pittsburgh School of Law. As an educational service, Paper Chase is dedicated to presenting important legal news and materials rapidly, objectively and intelligibly in an accessible format.

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