Apple Inc infringed two telecommunications patents used in devices, including iPhones and iPads, London’s Court of Appeal ruled on Tuesday. The ruling marks a significant setback for the tech giant in its long-running dispute with a U.S. patent holder over the patents, which the company says are essential to specific technological standards, such as 4G. The Court of Appeal backed the decision by a London high court last year that the two patents were so-called standard essential patents and that Apple had violated them.
The legal battle began in 2019 when Optis Cellular Technology LLC, a PanOptis Patent Management subsidiary, sued Apple for using its wireless communication patents without paying royalties. It has since expanded to six separate trials and several appellate hearings in Britain alone. This latest case involves two patents owned by Optis Wireless and used in 4G cellular communications. According to a report by Reuters, it could lead to Apple having to pay up to $506 million in damages.
This is one of many disputes over so-called standard essential patents (SEPs), which cover technologies required to comply with industry standards, such as 4G or 5G. SEPs should be licensed at fair, reasonable, and non-discriminatory (FRAND) terms, but there are often disagreements over what those rates should be.
In this case, Optis Cellular sought a FRAND license for the two disputed SEPs, part of a more comprehensive portfolio covering the LTE cellular standards. The U.K. High Court ruled 2022 that the two SEPs were so-called standard essential patents, meaning Apple must agree to a FRAND license or risk blocking its products from sale in the country. Apple appealed that ruling in May, arguing the patents were not essential to 4G, but the Court of Appeal rejected that argument on Tuesday.
Judge Colin Birss said the High Court had “correctly concluded that the patents in question were essential to the operation of 4G cellular networks” and that Apple had infringed them. He also ruled that the Optis Wireless patents covered the technology of mobile phones and that they were, therefore, essential to those systems.
