Apple Inc. (NASDAQ:AAPL) has said it will appeal a fine of $532.9 million handed by a federal jury on allegations it infringed on patent rights owned by a Texas company with its iTunes software. The fine is slightly lower to the $852 million in damages that Smartflash LLC was seeking while Apple on its part maintains the damages were worth $4.5 million at most.
In the verdict; the Jury rejected Apple Inc. (NASDAQ:AAPL)’s arguments that it did not use the inventions and that the patents were invalid. The lawsuit cycled around digital rights management and inventions for data storage and for managing access through payment systems. Smartflash had argued that Apple’s iTunes infringed on its patents on applications such as Game Circus LLC and 4 Pics 1 vie. Apple generated $18 billion in revenue from its iTunes last year accounting for 10% of its total revenue.
Apple Inc. (NASDAQ:AAPL) spokeswoman, Trudy Muller took swipe of Smartflash after the verdict reiterating it does not make any products and neither does it have employees with any U.S presence and was only seeking royalty payment for technology it did not invent. Smartflash sought $852 million in payment arguing it was entitled to a percentage of Apple devices sales including iPhone, iPad and Mac computers.
Smartflash argues that Apple infringed on the patents knowingly as one of its executives had already been briefed on the technology over a decade ago. Apple on its part maintains Smartflash did not have control of the apps as alleged and only waited too long to file for the lawsuit. California-based Apple Inc. (NASDAQ:AAPL) maintains Smartflash’ royalty demands were excessive and unsupportable.
Smartflash was started in 2000 by inventor Patrick Racz and. According to court filings he had been offered less than $200,000 for an interest on one of his patents. Smartflash does not make any products but has licensed seven of its patents issued between 2008 and 2012.