Jury rules Apple to pay $837 million to Caltech over Wi-Fi patent infringement

Nearly four years after Caltech sued Apple and Broadcom for allegedly infringing the university’s four patents on Wi-Fi data transfers, a federal jury found the two companies guilty of infringement and ordered to pay California Institute of Technology a total of $1.1 billion in damages. The jury ordered Apple to pay $837 million and Broadcom $270 million. This seems to be based on Caltech’s hypothetical estimate that royalties could be negotiated in 2010.

Jury rules Apple to pay $837 million to Caltech over Wi-Fi patent infringement

According to Caltech, Apple’s compensation for each device is about $1.40, and Broadcom’s compensation for each device should be 26 cents, mainly related to its 802.11n and 801.11ac Wi-Fi chip patents.

Joseph J. Mueller of Wilmer Hale, an apple and Broadcom lawyer, noted that the patents were granted only once, and that their co-inventor, Hui Jin, testified that he had never considered commercializing The Wi-Fi patent. Until he heard that Broadcom and Apple might infringe their patents.

Apple also argues that they are not responsible for using off-the-shelf Wi-Fi chips provided by Broadcom rather than developing any infringing technology themselves.

Still, those arguments didn’t work for the final ruling, and the jury focused only on whether the two violated the university’s patents, and the precedent of whether Caltech would try to sue other electronics manufacturers using the same technology in the future would be an interesting question.

Coincidentally, Apple and Broadcom just announced a $15 billion deal last week to provide Apple with more wireless chips for the next three and a half years. Apple also said it reserved the right to appeal.