Patent Infringement Doesn’t Pay…Unless You’re Verizon, in Which Case You Owe $11 Million a Month for the Next 6 Months


The National Law Journal reports that starting December 16, 2011, Verizon must pay $2.74 per every FiOs customer each month as “sunset royalties” for their continued use of technology deemed to be infringing patents belonging to ActiveVideo.  The U.S. District Court for the Eastern District of Virginia had ruled in August 2011 that Verizon infringed four of ActiveVideo’s patents regarding interactive TV and video-on-demand applications. Verizon would have to pay “sunset royalties” for its continued use of the technology until it changed its internal system. Last week, the same court denied a motion from Verizon to stay having to pay “sunset royalties” pending an appeal.

As per the National Law Journal:

Eastern District of Virginia Judge Raymond Jackson on Dec. 12 denied Verizon’s motion to stay payment of the “sunset royalties.” Jackson had ordered a permanent injunction on Nov. 23 allowing Verizon to continue using ActiveVideo’s technology during a six-month sunset period — as long as it pays $2.74 per FiOS TV subscriber per month on the first day of each month.


The jury awarded $1.13 per FiOS subscriber per month, but the sunset payments will be higher because Jackson conducted a second hypothetical negotiation following the verdict, “and concluded that ActiveVideo was in a much stronger bargaining position than before the verdict,” Johnson said.

For the rest of the National Law Journal article, including an interesting note on whether injunctions would even be feasible in patent infringement cases, click here.

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