Another big verdict went up in smoke at the U.S. Court of Appeals for the Federal Circuit on Tuesday, when the appeals court ordered a new damages trial in VirnetX Inc.’s patent infringement case against Apple Inc. The ruling is a blow to attorneys at McKool Smith, who worked on a partial contingency fee, and a victory for longtime Apple counsel William Lee of Wilmer Cutler Pickering Hale and Dorr.
In a 41-page ruling, the Federal Circuit mostly affirmed a 2012 verdict that VirnetX’s patents relating to virtual private network (VPN) technology are valid and infringed by Apple. But the panel wiped out the jury’s $368.2 million damages verdict, ruling that jurors heard unreliable expert testimony and that U.S. District Judge Leonard Davis in Tyler, Texas, erroneously instructed the jury about a method for calculating damages known as the entire market value rule.
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