Federal Circuit Revives Apple Patent Case, Hears $368M VirnetX Appeal

Federal Circuit Revives Apple Patent Case, Hears $368M VirnetX Appeal William Lee of WilmerHale

Apple Inc. had a busy day at the U.S. Court of Appeals for the Federal Circuit on Monday. One Federal Circuit panel issued a decision reviving a patent infringement lawsuit against the company in the Northern District of California, while another heard oral arguments in the appeal of a whopping $368 million jury verdict that Apple lost to VirnetX Inc. in the Eastern District of Texas in 2012.

In the California case, a unanimous Federal Circuit panel breathed new life into a case brought against Apple by Ancora Technologies Inc., which holds a patent for a method of preventing software from running without a license. Ancora had consented to a judgment of noninfringement after U.S. District Judge Yvonne Gonzalez Rogers in Oakland construed the term “program” in a way that didn’t include Apple’s iOS operating system, the alleged infringing product.

The Federal Circuit rejected Rogers’ finding on Monday, ruling that the ordinary meaning of the word “program” in computing terms includes both operating systems and the applications that run on them. The panel found that Rogers had erred in limiting the term to only include software applications and remanded the case for further proceedings.

Brooks Kushman’s John LeRoy argued the appeal for Ancora. He wasn’t immediately available. Morrison & Foerster’s Deanne Maynard argued on behalf of Apple. She directed our request for comment to a company spokesman who didn’t immediately get back to us.

In the VirnetX case, meanwhile, both sides brought out the big guns for Federal Circuit oral arguments on Monday. Apple turned to Wilmer Cutler Pickering Hale and Dorr’s William Lee, while VirnetX tapped Finnegan, Henderson, Farabow, Garrett & Dunner’s J. Michael Jakes. Recordings of the arguments weren’t yet available on the court’s website Monday evening.

Apple is attempting to overturn a $368 million verdict that a Tyler, Texas, jury handed down in November 2012, after finding that Apple’s popular FaceTime feature and the virtual private network on-demand function of its operating system infringed VirnetX patents. As we’ve reported, McKool Smith handled the trial for VirnetX, while Williams Morgan & Amerson and the Albritton Law Firm represented Apple.

In related news, VirnetX announced in an SEC filing Monday that the court in Tyler had issued an order awarding it an ongoing royalty of .98 percent on products incorporating the FaceTime or VPN on Demand features that were found to infringe. Seeking Alpha reported that VirnetX’s stock had soared in response to the royalty news.

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