VirnetX Holding

VirnetX Holding — software developer in the field of information security. As of the end of 2014 the company has more than 80 patents used in electronics of different producers.

History

2020: Apple will pay VirnetX of a royalty in $502.8 million for use of VPN service

At the beginning of November, 2020 it became known that according to the decision of federal court of Texas, Apple should pay VirnetX companies of $502.8 million as a royalty for use of the VPN on Demand function which allows users of IOS to get access to VPN connection.

Lawsuits between Apple and VirnetX last ten years. The VirnetX company claims that VPN on Demand and FaceTime Apple use technologies which were developed by the company especially for Central Intelligence Agency of the USA.

Apple will pay VirnetX companies of $0.5 billion for foreign VPN in iPhone

VirnetX expected to receive more than $700 million, however in Apple agreed to $113, claiming that the rate of a royalty should not exceed $0.19 for unit, the court nevertheless stopped for $0.84 for unit.

It is said in the statement of Apple that the company intends to appeal against court's decision.

We thank jury for the spent time and we appreciate their attention, but are disappointed with a verdict and we are going to submit the appeal. This case continues more than ten years, and the patents which are not connected with primary activity of our products were nullified by patent office. Similar cases serve only for suppression of innovations and are harmful to consumers, said in the statement of Apple.

In 2020 it was already offered to technology giant to pay the court order VirnetX of $454 million, however payments concerned earlier versions of VPN on Demand. The new court order obliges to pay Apple to $502.8 million in addition to that amount.

Expecting one more large payment from Apple, VirnetX fights against charges that the family of the chief executive officer Kendall Larsen makes the fifth part of 21 employees of the company, and the company "suffers from nepotism, squandering and failures in corporate management".^[1]

2018: A prize in court of $500 million at Apple

On April 10, 2018 the Texas court rendered a verdict according to which Apple should pay VirnetX more than half a billion dollars for illegal use of technologies in the products.

In the claim which was submitted in 2012 Apple was accused of violation of the intellectual property rights of VirnetX, connected with safe data transmission, when developing VPN on the Demand Apple function, a video chat of FaceTime and a message exchange system iMessage in devices iPhone iPad, iPod touch and Mac-computers.

Apple will pay half a billion dollars for theft of technologies

In 2017 the court decided that Apple should pay to the claimant $439.7 million. In April of the 2018th additional compensation in $502.6 million is appointed. Thus, VirnetX seized from the American IT giant in total nearly $1 billion.

The CEO of VirnetX Kendall Larsen called a new penalty for Apple "fair" and reported that it is calculated, proceeding from sales about 400 million devices of Apple.

Proofs are obvious. It is necessary to tell the truth that not to worry about anything — Larsen said.

Originally VirnetX required compensation on the basis of total sales of the equipment, including smartphone iPhone 5, the iPad tablet of fourth generation and computers on to the operating system OS X Mountain Lion.

The western press calls VirnetX by the so-called "patent troll". This term describes the company which specializes in legal lawsuits on intellectual property. And patents, as a rule, cover rather general spheres, and the company does not make any products.

In 2018 the companies 13 years were performed and for all this time under the VirnetX brand there was no device and any service was not provided. At the same time the company seized hundreds of millions dollars from IT giant among which — Apple, Microsoft and Cisco.^[2]

2014: Microsoft pays VirnetX again

In the middle of December, 2014 Microsoft and VirnetX signed the agreement on which conditions the last withdraws the claim for the patents which are illegally used in Skype in exchange for compensation in the amount of $23 million. Parts of this arrangement are not sounded.^[3]

Thus, the general payments of Microsoft for benefit of the opponent who is called the patent troll made $223 million. VirnetX gains the most part of income from sale of licenses for the technologies. The company possesses about 80 patents, about 100 applications are submitted for registration to patent office (as of December of the 2014th).

Payments of Microsoft to the patent troll of VirnetX approached a quarter of one billion dollars

As for Apple with which VirnetX has legal proceedings not the first year, payments from iPhone and iPhone producer did not follow. The matter is that in September, 2014 the circuit court of appeal in Washington repealed the judgement on collecting from Apple of $368.2 million passed in 2012. Then the judge returned case of Apple on reconsideration to court of first instance.

2012-2013

Victory over Apple

In 2012 district court of the USA on east District of State of Texas made the decision according to which Apple really violated a number of patents of VirnetX therefore should compensate to the claimant about $368.2 million against $708 million required earlier VirnetX.

Claim to Microsoft

The license agreement which Microsoft and VirnetX signed in 2010 was automatically broken after in 2011 Microsoft purchased Skype. Therefore in April, 2013 VirnetX submitted a claim against Microsoft again, having pointed to violation of six patents in work of VoIP-service and products to which it is connected.

2010: Victory over Microsoft

In March, 2010 the court found Microsoft guilty in patent infringement, the belonging VirnetX, and imposed on the software giant a penalty in the amount of $106 million. The Windows producer did not agree with this verdict and tried to appeal against it.

However VirnetX submitted one more claim against Microsoft therefore the last decided to settle a dispute, but the compensation amount was twice more former — about $200 million.

In the same 2010 of VirnetX accused Apple of unauthorized use of intellectual property items when developing technology of video conference of FaceTime implemented in smartphones, tablets and computers.

2007: The first claim against Microsoft

In 2007 VirnetX submitted a claim against Microsoft, having accused corporation of illegal use of the patented technologies connected with virtual private networks in the operating systems and some other products.

Notes