Apple could close its UK operations over latest hefty fine
Apple has threatened to leave the UK over an pending patent dispute in UK courts. Lawyers representing the California company, which last year produced the UK’s first and second best-selling smartphones with its iPhone 12 and iPhone SE series, expressed the threat over “commercially unacceptable” terms in the case.
The case arose when British patent holder Optis Cellular Technology sued Apple for alleged patent infringement after the US company refused to pay licensing fees worth about $7 billion (about £5 billion) for the use of “standardized” smartphone technology in its devices. While Apple believes the technology described in the patent is commonplace across the industry, a UK Supreme Court judge has ruled that the iPhone manufacturer has infringed two Optis patents designed to enable devices to connect. related to mobile networks.
Kathleen Fox Murphy, a lawyer representing Optis, said of the case, “Everyone sees Apple as the industry leader in smartphones, but Apple needs to buy most of the technology in an iPhone.”
Optis Cellular Technology and its sister companies PanOptis, Optis Wireless Technology, Unwired Planet and Unwired Planet International are one of the so-called non-practicing entities. These companies have patents on some technologies that they didn’t invent. Instead, these companies generate revenue through lawsuits. Some call these firms “patent trolls”.
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The UK lawsuit isn’t the first time Apple has been on the receiving end of Optis Cellular Technology. Last year, sister company PanOptis sued Apple in Texas, resulting in a $506 million fine (about £365 million) over a patent surrounding the use of 4G cellular data connectivity.
Apple will face court in July 2022, which will decide how much the California company must pay for the patent infringement. Last year, the UK Supreme Court ruled that a UK court could set the rate Apple would have to pay for using these patented technologies around the world – even though the court only considers UK patent infringement.
That ruling will drive up the fine, even though UK courts have no jurisdiction to enforce patent infringements in other countries worldwide.
At a court hearing earlier this year, Justice Meade hinted that Apple might be “might be disappointed” by the impending fine. While Apple could evade the sanction if it decides to exit the UK market, Justice Meade suggested it was unlikely.
Meade said: “There is no evidence that Apple is really going to say no” [to paying the rate set by the judge], is there? There is no evidence that it is even remotely possible for Apple to exit the UK market?”
Unfortunately, lawyers representing Apple called Justice Meade’s bluff — and threatened to do just that. In a statement, lawyers suggested exiting the UK market could become an unavoidable option for the company due to “commercially unacceptable” terms.
Marie Demetriou, a lawyer representing Apple, said: “I’m not sure if that’s right. Apple’s position is that it should indeed be able to think about the terms and decide if it’s commercially appropriate to use them.” to accept or leave the UK market may be terms established by the court that are simply commercially unacceptable.”
Apple could pull out of the UK market, closing its stores and blocking sales of its best-selling gadgets, including iPhone, iPad, MacBook, AirPods and more. Not only that, but it could also lead to massive job losses – the App Store supports some 330,000 people in the UK.
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