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Judge Drops Apple's $533M Fine in iTunes-Related Lawsuit, Sets New Damages Trial

Wednesday July 8, 2015 6:47 am PDT by Joe Rossignol
newitunes122logoThe U.S. District Court for the Eastern District of Texas on Tuesday voided $532.9 million in damages awarded to patent licensing firm Smartflash LLC in February in an iTunes-related patent lawsuit, per Reuters.

The report claims federal judge Rodney Gilstrap has set a new damages trial on September 14 after ruling that "his jury instructions might have 'skewed' jurors' understanding of the damages that Apple should pay."

Apple was initially ordered to pay $532.9 million in damages to Smartflash LLC after a federal jury in the Tyler, Texas courtroom found certain iTunes apps to be infringing upon the company's patents related to digital rights management, data storage and managing access through payment systems.

Apple countered that Smartflash LLC was exploiting the patent system to collect royalties.
“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.”
Smartflash LLC was originally seeking $852 million in damages, and claimed it was entitled to a percentage of sales of Apple products used to access iTunes, such as iPhones, iPads and Macs. Apple argued that $4.5 million was fair at most, claiming it does not infringe upon any of Smartflash LLC's inventions and that its patents are invalid.

Apple likely still faces a fine of a different amount pending the results of the new damages trial scheduled for September, but the iPhone maker plans to appeal the decision.

Tags: lawsuit, iTunes, patent, Smartflash LLC, patent trials
[ 46 comments ]


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duffman9000
49 months ago
Is this the same "judge" that is leaving NewEgg hanging ('http://arstechnica.com/tech-policy/2015/07/after-20-month-delay-a-furious-newegg-still-cant-appeal-2-3m-patent-loss/') on another trial? Sounds like another judge who loves hearing the sound of his own voice.

EDIT: Yup, same creep.
Rating: 7 Votes
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roland.g
49 months ago
Eastern Texas patent courts. It's like some sort of cocoon for last century thinking.
Rating: 4 Votes
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bbeagle
49 months ago

OH EM GEEE.. Apple could never do wrong, this is just DUMB... pathetic "patent trolls" just wanting a handout. :rollseyes:

Apple does wrong
Patent trolls exist
Both do wrong
Get over it

This judge is an idiot too.


Apple also does a lot right
Maybe you shouldn't label every Apple fan as someone who says Apple does no wrong.
Less than 1% of the zealots here think Apple is God.
A lot more people here think Apple is the anti-christ than think they are God.
Get over it
Rating: 3 Votes
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knemonic
49 months ago
These patent trolls need to go on Horders.
Rating: 2 Votes
Avatar
bbeagle
49 months ago

You would need to ask Apple...


Or MOST companies. Almost EVERY company holds many patents they don't use. That's the nature of the beast.

Microsoft and Google hold far more patents than Apple - why aren't you singling them out like you are with Apple?
Rating: 2 Votes
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Mascots
49 months ago

Complete crap. How can you hold patents when you do not make any products that use any of those patents?


Not only to allow the Average Joe to protect work that he does not have the resources to produce, but also to allow those ideas to be used by others with fair compensation to Joe.

However, we've seen this aspect abused a lot recently because of poor transition of the patent system into the programming world and its loose accountability of what actually can get, and in what gets patented.
Rating: 1 Votes
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Orlandoech
49 months ago
OH EM GEEE.. Apple could never do wrong, this is just DUMB... pathetic "patent trolls" just wanting a handout. :rollseyes:

Apple does wrong
Patent trolls exist
Both do wrong
Get over it

This judge is an idiot too.
Rating: 1 Votes
Avatar
duffman9000
49 months ago

There must be some method to his madness.

Judge Gilstrap ruled in favor of TQP for 2.3 million. However, if he doesn't submit the ruling, TQP doesn't get paid, and NewEgg doesn't owe them any money. NewEgg can't appeal as there is no ruling submitted - yet they don't have to pay either, because there is no ruling submitted.

Maybe this was Judge Gilstrap's way of making sure NewEgg doesn't pay? I don't know. There HAS to be more to this story.


No method to his idiocy. NewEgg had to set aside the money to cover the award. Money that could be used elsewhere.
Rating: 1 Votes
Avatar
Dilster3k
49 months ago
Off-topic: I'm sorry but that new icon just doesn't blend in nicely with my dock...
It looks nice, but doesn't quite fit in next to the App Store & iBooks icons.
Rating: 1 Votes
Avatar
Gasu E.
49 months ago

There must be some method to his madness.

Judge Gilstrap ruled in favor of TQP for 2.3 million. However, if he doesn't submit the ruling, TQP doesn't get paid, and NewEgg doesn't owe them any money. NewEgg can't appeal as there is no ruling submitted - yet they don't have to pay either, because there is no ruling submitted.

Maybe this was Judge Gilstrap's way of making sure NewEgg doesn't pay? I don't know. There HAS to be more to this story.


No, because NewEgg has to hold the $2.3 M in escrow. That's a significant expense, which they could be using more productively. If it sat in escrow "forever", it would be the same to Newegg as actually paying it. The longer it sits in escrow, the more it resembles an actual payment from a business standpoint.
Rating: 1 Votes

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