The case has been sent back to the Texas trial court.
An appeals court in the US issued on a patent infringement ruling that had ordered Apple to pay $368m to VirnetX in 2012 by sending the case for reassessment to the lower federal court in Texas.
VirnetX alleged that the Apple’s FaceTime feature on Apple devices, and a feature related to virtual private networks, breached its patented technologies.
The patents under discussion include FaceTime and VPN On Demand operations in Apple’s iPhones, iPads, and Mac devices, which were created by Science Applications International (SAIC).
The US Federal Circuit Court of Appeals ruled that the verdict was ‘tainted’ by invalid jury instructions in the case.
In its ruling, the appeals court ordered the Texas District Court to re-check the patent claims as per the appeals court’s new term structure, as Texas court failed to define a term appearing in two of the patents.
The ruling noted: "Apple argues that the testimony of VirnetX’s expert on the proper royalty base should have been excluded because it relied on the entire market value of Apple’s products without demonstrating that the patented features drove the demand for those products."
VirnetX CEO and president Kendall Larsen said: "While we are disappointed that the Federal Circuit has vacated portions of the judgment for further proceedings, we are bolstered by the fact that the patents were again found valid and that it was confirmed that Apple’s VPN on Demand functionality infringes the VirnetX patents.
"We look forward to readdressing the FaceTime infringement and damages issues as soon as possible."