Apple Loses Patent Lawsuit – Here’s Why A U.S. Jury Could Order iPhone Maker To Pay $862 Million In Damages To University Of Wisconsin

Apple Inc. has lost an important patent lawsuit in an American court. A bench of jury hearing the case was convinced that Apple used University of Wisconsin’s technologies in processing chips that go into majority of the devices Apple makes.

A U.S. jury has found Apple Inc. guilty of using University of Wisconsin’s technologies to make most of its devices more efficient. Though the court hasn’t yet announced any compensation to be paid out, Apple Inc. could be facing up to $862 million in damages. The licensing arm of the American University had claimed that Apple had infringed on a patent it had filed way back in 1998.

At the heart of the patent lawsuit was Apple’s A7 System on a Chip (SoC), a miniature multi-component processor that was hailed as a game changer of its time for its revolutionary design and multi-faceted performance capabilities. The Wisconsin Alumni Research Foundation (WARF) mentioned in its patent lawsuit that Apple Inc. “has been, and currently is infringing the ‘752 patent…without license or authority,” reported The Huffington Post.

The patent, which the jury believes Apple infringed upon, is called ‘Table Based Data Speculation Circuit for Parallel Processing Computer,” reported the Daily Mail. Though the name is a mouthful, the patent offers a way to simplify processes and their priorities so that the processing chip handles them in the most optimum way.

As expected, Apple Inc. had strongly refuted such claims and termed them “invalid.” Moreover, Apple even tried to convince the U.S. Patent and Trademark Office to closely review the original patent’s validity. But the agency rejected the bid in April of this year, and the jury ruled in favor of the University of Wisconsin.

WARF v. Apple

The verdict merely means that now, the jury will deliberate on how much compensation to award the licensing arm of the American University. But according to a recent ruling by U.S. District Judge William Conley, who is presiding over the case, industry experts estimate losing the patent lawsuit could cost Apple as much as $862 million (£561 million) in damages.

Interestingly, when WARF had sued Intel Corp back in 2008, the latter had quickly settled before the case went to trial. So confident is WARF that it has already targeted Apple’s newest chips, progressively named A9 and A9X. These advanced chips are being used in the just-released iPhone 6S and 6S Plus, as well as the iPad Pro.

Apple A7 SoC Patent Lawsuit

Interestingly, the lawsuit is fairly new. WARF had sued Apple in January last year, alleging that Apple had infringed its 1998 patent for improving chip efficiency. Worryingly for Apple, though the patent lawsuit categorically mentioned Apple’s A7 SoC, the jury was considering whether Apple’s A8 and A8X processors, found in the iPhone 5s, 6 and 6 Plus, as well as several versions of the iPad, violate the patent too, reported Reuters. The A7 was used in iPhone 5s, iPad Air, iPad Mini with Retina display, and iPad mini 3.

What will Apple do? Patent lawsuits aren’t uncommon for Apple Inc. The company has been fielding them with the dexterity of an expert juggler for many years. Interestingly, the company plays patent-wars even with its own component suppliers. Hence, in most likelihood, Apple will appeal the decision and attempt to get the patent lawsuit reexamined, preferably in front of a new jury and a different court.

[Update] The amount being speculated has been halved, according to two people familiar with the case, reported Yahoo. Though there’s a significant reduction in the damages, it is unlikely Apple Inc. will fork out the money so easily or so early.

[Image Credit | Mandy Cheng / Getty Images, FirstPost]