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In a dramatic turn of events, Apple and its Wi-Fi chip supplier, Broadcom, have finally put an end to a prolonged legal battle with the California Institute of Technology (Caltech), reports Reuters. After seven long years of courtroom clashes and legal wrangling, this tech saga has come to a close, marking a significant milestone in the tech industry.
While the specifics of the settlement remain confidential, one thing is clear: Caltech has dropped its lawsuit against Apple and Broadcom with prejudice, ensuring that the door is firmly closed on any future litigation from the institute.
The saga began in 2016 when Caltech launched a lawsuit, accusing Apple and Broadcom of infringing upon its treasure trove of Wi-Fi patents. These patents encompassed encoding and decoding circuitry designed to enhance data transmission and overall performance. The lawsuit cast a wide net, ensnaring Apple’s flagship products: the iPhone, iPad, Mac, and Apple Watch, all allegedly utilizing Caltech’s technology.
Apple, not one to back down, responded with a countersuit aimed at invalidating Caltech’s patents. Unfortunately for the tech giant, this legal tactic fell short. The tipping point came in 2020 when a jury ruled in favor of Caltech, determining that both Apple and Broadcom had indeed infringed upon the institute’s patents. The verdict sent shockwaves through the industry, as Apple was slapped with a staggering $838 million bill, while Broadcom received a sizable $270 million judgment.
The combined total of $1.1 billion was poised to be one of the largest payouts in U.S. history for a patent dispute. However, the story took an unexpected twist when Apple and Broadcom decided to appeal the decision. Their efforts paid off when the U.S. Court of Appeals for the Federal Circuit weighed in.
While acknowledging that the two tech giants had infringed upon Caltech’s patents, the appeals court deemed the damages awarded as unjustified. The previous court had employed a two-tier system to determine the damages, based on varying royalty rates, a move the appeals court deemed “legally unsupportable.”
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Consequently, the court ordered a fresh trial to recalibrate the compensation owed to Caltech by Apple and Broadcom. Rather than proceeding with a second trial, these industry titans, along with Caltech, informed the court in August that a potential settlement was under negotiation. And now, it is official—peace has been restored in the tech kingdom.