Apple has had a bite taken out of it’s iTunes today after a jury ordered the company to pay $533 million in damages to settle a dispute that sits at the root one of of Apple’s largest and most-recognized programs. The jury found that Smartflash had their rights wrongfully infringed upon when Apple utilized different data management tools, payment methods, and more in iTunes and the App Store. While Smartflash doesn’t actually produce anything, or do anything productive besides hold patents – companies like this, experts say – frequently file lawsuits against large companies who ultimately violate those patents.
Over time, companies like Smartflash have garnered such labels as being deemed “patent trolls,” due to their frequency to actually file lawsuits against these major companies – when they don’t have as much of a stake in the actual competition of the product that is being sued over. For example, a company like Google would have a much larger problem with iTunes method of utilizing payments since they compete directly with iTunes on that front and for those customers. However, Smartfish merely holds a patent, and waits for other companies who actually produce a physical item to sue – or license the patent out to users. They chiefly make their money from licensing fees which for a tech company like Apple – are an entirely common phenomenon.
Smartfish though argued that in asking for over $850 million that they deserved some level of profits from the actual sales that were generated in iTunes and from Apple devices. This was a move that many individuals noted that they would see coming as this is a common practice in the field. That being said, Smartfish ultimately was able to get what they did because they, very simply, had the evidence and a case to support such an action by the jury. Apple’s lawyers though argued very soundly that Smartfish did not even respect what Apple had done for the industry as a whole, and noted that what they were going after in court was both “excessive and unsupportable.” While there is some action that Apple can take, it really comes down to how many feathers the company is willing to ruffle before letting this issue go away on its own.