Apple Hit With $2.8 Billion Patent Lawsuit Over VoIP Technology

VoIP-Pal announced today that it has filed a lawsuit against Apple in a U.S. District Court in Las Vegas, Nevada, seeking over $2.8 billion in damages for alleged infringement of its patented internet communication technologies.

The Bellevue-based company calculated its $2,836,710,031 figure using a 1.25-percent royalty rate based on an apportionment of Apple's estimated historical profit from iPhone (55-percent), iPad (35-percent), and Mac (10-percent).

VoIP-Pal (VPLM) has over a dozen issued or pending patents, primarily related to VoIP technologies, a few of which it accuses Apple of infringing upon with services like FaceTime and iMessage on iPhone, iPad, and Mac.

Apple employs VPLM’s innovative technology and products, features, and designs, and has widely distributed infringing products that have undermined VPLM’s marketing efforts. Instead of pursuing independent product development, Apple employed VPLM’s innovative caller attribute classification and routing product design, in violation of VPLM’s valuable intellectual property rights.

The court filing cites multiple ways that Apple is allegedly infringing upon the patents, including the following iMessage claim:

In particular, devices running the iMessage application initiate a communication between a caller and a callee. The callee may be an Apple subscriber or a non-subscriber. In the case that the callee is an Apple subscriber, the communication is sent using iMessage. On the other hand, if the user is not an Apple subscriber or if iMessage is not available, the communication is sent using SMS/MMS. Apple’s messaging system directly and/or indirectly practices certain claims of the ‘815 patent in order to determine the classification of a user, and, subsequently, how the call should be routed.

The lawsuit was originally initiated on February 9, but VoIP-Pal delayed pursuing legal action until Monday as the company says it remains engaged in discussions with Apple outside the courtroom regarding an amicable resolution. The company appears to be open to a sale or licensing of its patent portfolio.

"We are confident the current good will on both sides will result in a favorable outcome for all parties involved," said Emil Malak, CEO of VoIP-Pal.

VoIP-Pal, which acquired network operator Digifonica in 2013, describes itself as "a technical leader in the broadband VoIP market." The company does not currently generate income, but insists it is "absolutely not" a patent troll, noting that Digifonica began designing its system back in 2004.

We designed, built and tested super-nodes and nodes in Canada, England, and Norway, spending more than $17 million on development and execution in the process. At one time, we had more than twenty (20) engineers working on the software design and implementation. […]

Due to the Great Recession in the mid 2000’s, Digifonica was unable to continue supporting the platform, while it was continuing its significant investment in protecting the intellectual property it had developed. […]

The infringing companies are making billions of dollars using technology that were conceived, designed, built, tested and patented by Digifonica.

VoIP-Pal has filed similar lawsuits against AT&T and Verizon in Las Vegas court.