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VirnetX Beats Apple Again in Decade-Old Patent Lawsuit

By Rich Duprey – Updated Sep 2, 2020 at 10:30AM

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The long-running court battle may be finally drawing to a close, with Apple having to pay almost $440 million.

VirnetX Holding (VHC -2.56%) has been victorious yet again in its patent infringement case against Apple (AAPL 3.08%), which has been dragging through the courts for a decade.

VirnetX announced today that the U.S. District Court for the Eastern District of Texas has ruled that Apple is not entitled to relief from having to pay VirnetX almost $440 million for infringing on its patents related to Apple's VPN-on-demand feature.

Apple FaceTime feature on iPhone and iPad

Image source: Apple.

The case stems from a 2010 case in which the internet security specialist accused Apple of infringing on its patents relating to secure networks -- called virtual private networks (VPNs) -- and secure communications links in Apple's FaceTime videoconferencing app.

Although VirtnetX has been referred to as a patent troll with its contention that it owns most of the crucial patents related to security across the internet, it has gone after most of the top tech stocks, including Apple, Cisco, and Microsoft, to enforce them, and has been mostly successful.

Apple appealed its loss all the way up to the U.S. Supreme Court, and while it has won minor victories along the way, such as rulings that FaceTime doesn't infringe on the patents, the larger battles have fallen VirnetX's way, and Apple may be running out of ways to avoid paying the judgment.

The latest decision derives from Apple's appeal of a federal court's ruling that its VPN-on-demand feature, which allows you to configure a secure connection anonymously to keep your data safe, violated two of VirnetX's patents.

VirnetX was awarded a total of $439.7 million in damages.

Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Rich Duprey has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple and Microsoft and recommends the following options: long January 2021 $85 calls on Microsoft and short January 2021 $115 calls on Microsoft. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Apple Inc. Stock Quote
Apple Inc.
$142.45 (3.08%) $4.25
VirnetX Holding Corp Stock Quote
VirnetX Holding Corp
$1.14 (-2.56%) $0.03
Microsoft Corporation Stock Quote
Microsoft Corporation
$240.74 (3.37%) $7.84
Cisco Systems, Inc. Stock Quote
Cisco Systems, Inc.
$41.29 (4.18%) $1.66

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