Apple challenging $368M verdict with VirnetX

Apple says it's challenging a $368.2 million decision by a Texas court last November over security patents.

Josh Lowensohn
Josh Lowensohn Former Senior Writer
Josh Lowensohn joined CNET in 2006 and now covers Apple. Before that, Josh wrote about everything from new Web start-ups, to remote-controlled robots that watch your house. Prior to joining CNET, Josh covered breaking video game news, as well as reviewing game software. His current console favorite is the Xbox 360.
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Apple is challenging a verdict from a Texas court last November that left it on the hook to pay security software company VirnetX $368.2 million in damages.

The news came tucked inside Apple's quarterly report, which was filed earlier this week, Computerworld notes.

"The Company is challenging the verdict, believes it has valid defenses and has not recorded a loss accrual at this time," Apple said in its filing with the U.S. Securities and Exchange Commission.

The original complaint, which was filed in August 2010, accused Apple of infringing on four of VirnetX's patents covering virtual private networking technology, specifically on its iOS devices. After VirnetX won, Apple noted in a knowledge base article that its VPN settings would change beginning with iOS 6.1, though a report earlier today by ArsTechnica found that Apple had reverted to the earlier system.

VirnetX has gone after others for patent infringement in the past, including Cisco and Avaya. That list also includes Microsoft, which VirnetX sued in 2007 and again in 2010 over two of its patents for VPN technology. After winning a $105 million judgment against Microsoft, the two companies settled as part of a $200 million deal. Earlier this week, the company launched another volley against Microsoft and its Skype unit, accusing it of further patent infringement.

Still in play is a separate complaint by VirnetX against Apple, filed almost immediately after its November win. It accuses Apple of infringing on four of VirnetX's patents with its FaceTime video chat technology. There's also a separate complaint filed by VirnetX against Apple and currently under investigation by the U.S. International Trade Commission.

CNET has contacted both companies for comment and will update this post when we know more.