Apple has
suffered a patent defeat involving some of the technologies it uses in its
iTunes store.
The
company has been ordered to pay $533m (£344m) to Smartflash, a British Virgin
Islands-based firm that owns and licenses tech-related patents but does not
make products itself.
Smartflash
had asked for a bigger payout, but said it was "happy" with the
verdict.
Apple
said it intended to appeal and called for patent reform.
"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," the iPhone maker said in a statement.
Apple's
defeat by Smartflash is the latest in a series of victories by companies
referred to as non-practising entities (NPEs), and denounced by their critics
as being "patent trolls".
Earlier
this month, Samsung was ordered to pay Rembrandt IP $15.7m for infringing two
Bluetooth-related patents, and security firm Symantec was told to pay
Intellectual Ventures $17m for using two anti-malware inventions it owned.
The scale
of the penalty imposed on Apple was, in part, determined by the fact that the
jury felt the tech giant had not only used Smartflash's intellectual property
without permission, but had also done so "wilfully" - meaning it had
been aware of the infringement.
Calculation
The jury
found in Smartflash's favour in all three of the patents involved in the case.
The
intellectual property filings described
techniques to manage the
storage of audio and video files, apps
and games, including ways to ensure the data had been purchased
properly before being allowed to run on a portable device.
Smartflash
had sought $852m in damages for Apple's unauthorised use of the patents, basing
its calculation on the number of Mac computers, iPhones and iPads that had been
sold.
Apple had
attempted to argue that the patents were either invalid or worth less than $5m.
According
to the Bloomberg news website, Smartflash will next go
to trial against Samsung in a related dispute.
It said
the company had also sued Amazon and Google.
NPEs
accounted for more than half of all patent cases filed in the US, according to
a report published by PricewaterhouseCoopers last year. It
said most were settled out of court or dismissed.
President
Obama has urged Congress to "combat patent trolls" by reforming
the legal system they operate in.
But
others note that NPEs can play an important role by creating a market for
inventions developed outside the largest company's labs.
"If
you are a small start-up, a university or other researcher you may not be able
to bring a product to market that would take billions of dollars to develop and
would compete with the established big players," said Ilya Kazi, from the
Chartered Institute of Patent Attorneys.
"But
you may have come up with a genuine innovation, and there is a role to be
played to protect that innovation and extract a royalty for it."
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