Judge axes Apple’s $308.5m patent bill over plaintiff delays
Apple has escaped a $308.5 million patent infringement verdict after a Texas federal judge found the plaintiff tried to squeeze excessive royalties on old technologies.
A jury determined the tech company should pay the sum in March, after finding it infringed patents owned by Personalized Media Communications (PMC). The IP relates to digital rights management tech used to distribute content through apps like Apple Music.
Judge Rodney Gilstrap of the US District Court for the Western District of Texas has now found that PMC had intentionally delayed obtaining the patents until it could earn more money from royalties.
The PMC patents date back to applications first filed in the 1980s but not granted until 2010. At the time, patent terms were active from when they were granted. Now, patent terms last for 20 years from the date of application.
In the three months leading up to those rules changes, which came into effect in June 1995, PMC filed more than 300 patent applications. Any patents granted on these applications would be subject to the old rules and earn PMC a 17-year term of protection from when they were issued.
PMC would ultimately delay many of these applications until the technology was more widely adopted, in an effort to maximise its protection term and royalty earnings, the court found.
“The course of conduct undertaken by PMC constitutes an unreasonable delay and an abuse of the statutory patent system,” Gilstrap wrote.
PMC’s strategy was within the rules of US patent law at the time. Internal documents shown to the court underlined the company’s aims: “[PMC’s] strategy is to prosecute coverage on its technologies deliberately over time in such a way that broad coverage is in effect at any given time while the duration of coverage is prolonged as long as possible.”
Gilstrap wrote: “On this record, the only rational explanation for PMC’s approach to prosecution is a deliberate strategy of delay. PMC has not furnished any other reasonable explanation for its strategy other than to obtain a portfolio of patent coverage greatly in excess of the statutory term.”
“At such a size and scope, and through the means detailed above, PMC’s actions were a conscious and egregious misuse of the statutory patent system. PMC’s strategy, beginning at least in 1995, harmed the public interest to the detriment of science and the useful arts,” the judge added.
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