Apple Told to Pay $308.5 Million for Infringing DRM Patent (2)

Apple must pay $308.5 million to closely held Personalized Media Communications after a federal jury in Marshall, Texas, decided on Friday that the tech giant infringed a patent related to digital rights management.

Personalized Media had sued claiming Apple infringed its patent with technology including FairPlay, which is used for the distribution of encrypted content from its iTunes, App Store and Apple Music applications.

One expert for Sugar Land, Texas-based Personalized Media had calculated Apple owed $240 million in royalties. After a five-day trial, the jurors in Texas ordered Apple to pay a running royalty, which is generally dependent on the level of sales or usage.

Apple said it was disappointed with the ruling and would appeal.

“Cases like this, brought by companies that don’t make or sell any products, stifle innovation and ultimately harm consumers,” the company said in an emailed statement.

The lawsuit was originally filed in 2015, but Apple challenged the validity of the patent at the Patent Trial and Appeal Board. A U.S. appeals court last year reversed the board’s decision that certain patent claims were invalid, thus reviving the case for trial.

U.S. District Judge Rodney Gilstrap last week also adopted a magistrate’s recommendation denying Apple’s request to find the patent invalid.

Google and its YouTube service won a patent trial lodged by Personalized Media in November over different patents.

A case against Netflix is pending in New York.

The case is Personalized Media Communications LLC v. Apple Inc., 2:15-cv-1366, U.S. District Court, Eastern District of Texas (Marshall).

(Updates with Apple comment in fourth paragraph.)

--With assistance from Susan Decker and Mark Gurman.

To contact the reporters on this story:
Christopher Yasiejko in Wilmington, Delaware, at cyasiejko1@bloomberg.net;
Laurel Calkins in New York at lcalkins@bloomberg.net

To contact the editors responsible for this story:
Jon Morgan at jmorgan97@bloomberg.net

Elizabeth Wasserman, Joe Schneider

© 2021 Bloomberg L.P. All rights reserved. Used with permission.