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Texas Jury Orders Apple to Pay $532.9M in Patent Trial

Texas Jury Orders Apple to Pay $532.9M in Patent Trial

A Texas jury has ordered Apple to pay $532.9 million to patent licensing firm Smartflash LLC for using its patents without permission. Bloomberg reports the federal jury found that certain iTunes apps infringed on the Texas-based company’s digital rights management, storage, and payments system management patents.

GavelTexas Jury Orders Apple to Pay $532.9M in Patent Trial

The federal jury in Tyler, Texas, where Smartflash is based, rejected Apple’s arguments that iTunes didn’t make use of the inventions and that the patents were invalid.

“They are not just invalid, they are invalid many times over,” James Batchelder a lawyer at Ropes & Gray in East Palo Alto, California, who is representing Apple, told the jury.

Smartflash originally asked for $852 million in damages for infringing three patents, making the claim that it was entitled to a percentage of sales of Apple products that accessed the iTunes system, including iPhone, iPads, and Macs. Apple argued that $4.5 million was the most it should pay out, saying that it had not infringed on inventions owned by Smartflash, and that the patents were invalid.

“Smartflash makes no products, has no employees, creates no jobs, has no U.S. presence, and is exploiting our patent system to seek royalties for technology Apple invented,” said Kristin Huguet, an Apple spokeswoman. “We refused to pay off this company for the ideas our employees spent years innovating and unfortunately we have been left with no choice but to take this fight up through the court system.”

Developers Game Circus and KingsIsle Entertainment Inc. had also been named as defendants but they were dismissed from the case last year.

“Apple doesn’t respect Smartflash’s inventions,” the company’s lawyer, John Ward of Ward & Smith in Longview, Texas, told the jury. “Not a single witness could be bothered with reviewing the patent.”

Smartflash has also filed suit against Apple’s mobile device rivals, Samsung, Google and Amazon. The Samsung trial should soon be scheduled, while Google is fighting to have their case transferred to a California courtroom. Amazon was sued in December, also in Texas.

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