U.S. Supreme Court spurns Apple-Broadcom challenge to Caltech patents

The U.S. Supreme Court on Monday declined to hear a bid by Apple Inc (AAPL.O) and Broadcom Inc (AVGO.O) to revive their challenges to Caltech data-transmission patents in a patent infringement case in which the university's earlier $1.1 billion jury verdict against the companies was thrown out.

The justices turned away an appeal by Apple and Broadcom of a lower court's ruling affirming a trial judge's decision to prevent the companies from contesting the validity of the patents as they defended against the California Institute of Technology's lawsuit.

The U.S. Court of Appeals for the Federal Circuit, which specializes in patent cases, ruled against the companies' arguments because they failed to bring them up during earlier proceedings at the U.S. Patent and Trademark Office.

Apple and Broadcom have argued that they should have been allowed to raise the patent challenges during the trial.

A jury found that the companies infringed Caltech's patents, ordering Apple to pay $837.8 million and Broadcom to pay $270.2 million. The Federal Circuit took issue with the amount of the award, and sent the case back for a new trial on damages.

Caltech, located in Pasadena, California, sued Cupertino-based Apple and San Jose-based Broadcom in 2016 in federal court in Los Angeles, alleging that millions of iPhones, iPads, Apple Watches and other devices using Broadcom Wi-Fi chips infringed its data-transmission patents.

Apple is a major purchaser of Broadcom chips, and in January 2020 reached a $15 billion supply agreement that ends in 2023. Broadcom has estimated that 20% of its revenue comes from Apple.

The Federal Circuit also upheld the trial judge's decision to block the companies from arguing that the patents were invalid because they could have made the arguments in their petitions for USPTO review of the patents.

Apple and Broadcom told the Supreme Court that the Federal Circuit misread the law, which they said only blocks arguments that could have been raised during the review itself.

President Joe Biden's administration urged the justices in May to reject the case and argued that the Federal Circuit had interpreted the law correctly.

Caltech has also sued Microsoft Corp (MSFT.O), Samsung Electronics Co (005930.KS), Dell Technologies Inc (DELL.N) and HP Inc (HPQ.N), accusing them of infringing the same patents in separate cases that are still pending.