Apple Inc. (AAPL - Analyst Report) recently lost another lawsuit to VirnetX Holding Corp. (VHC - Snapshot Report) . This time it will have to shell out approximately $302 million in royalties to VirnetX for the infringement of certain Internet security patents (Facetime and iMessage technology) owned by the latter.
This is the third win by VirnetX over Apple. In Feb 2016, a Texas court had ruled that Apple misappropriated as many as four patents held by VirnetX. The iPhone-maker was asked to pay $625.6 million to VirnetX then. Moreover, the company had requested the jury to increase the payout by an additional $190 million when Apple decided to appeal against the decision.
VirnetX lawyers said in a statement "It is clear that Apple used our client's intellectual property without permission in order to sell hundreds of millions of devices, which is why the jury ruled the way it did."
VirnetX, which owns nearly 100 Internet security patents across the globe, generates most of its revenues through patent infringement lawsuits.
Apple is entangled in various legal battles over its mobile and tablet products. However, the results have not entirely been in its favor so far. In Sep 2016, Apple lost a $22.1 million lawsuit to Acacia Research (ACTG - Snapshot Report) for infringing certain patents related to cellular network technologies. Though Apple has enough cash to support such payments, these lawsuits remain an overhang on the company.
Currently, Apple has a Zacks Rank #3 (Hold). A better-ranked stock in the broader tech space is Finisar Corp. (FNSR - Snapshot Report) , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus estimate for Finisar surged 63.5% over the past 30 days for the current fiscal.
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