Consumer Electronics

Speaking of Apple Patents: VirnetX Refiles ITC Case Against Apple

Most patent case news of late has been Apple Inc. (NASDAQ: AAPL) suing to block Samsung from having what appears as knock-off iPhones by the look and feel of the phones. This morning comes new news on the patent front with Apple as the defendant.

VirnetX Holding Corp. (NYSEMKT: VHC) has refiled its complaint with the United States International Trade Commission against Apple Inc. The firm alleges that Apple:

has engaged in unfair trade practices by the importation, sale for importation, and sale after importation of certain devices with secure communication capabilities that infringe one or more claims of VirnetX’s U.S. Patent No. 8,051,181 (“the ‘181 patent”).

VirnetX also said that the accused products include the latest iPhones, iPads, iPods and Macintosh computers. The complaint also was filed jointly with Science Applications International Corp. (NYSE: SAI) to remove a procedural standing issue that was identified as the reason for dismissal of VirnetX’s previous complaint. VirnetX acquired a portion of its portfolio from SAIC back in 2006.

VirnetX has requested that the ITC “institute an investigation into Apple’s allegedly infringing imports and ultimately issue an Exclusion Order to bar importation of those Apple products.” The company is also seeking a cease and desist order to try to bar further sales and other domestic commercial activities of infringing Apple products that already have been imported.

The press release shows that VirnetX expects that the ITC investigation will formally commence on or about October 13, 2012, but it warned that the case will not be tried until way out in the second half of 2013. In short, Apple can make its filings to bust the cease and desist order if it is even granted. It is important to keep in mind that today’s news is not the first such complaint. It is a refiling of a complaint that has been ongoing. VirnetX is one of those companies called a “patent troll” by the investment community. Its shares have been incredibly volatile, as its $29.13 close on Friday compares to a 52-week range of $11.02 to $41.93. Yahoo! Finance lists its market capitalization rate now at almost $1.5 billion.

JON C. OGG

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