Apple owes the University of Wisconsin $506 million for using patented technology in iPhones and iPads

U.S. patent No. 5,781,752 may not sound special: It’s a “table based data speculation circuit for parallel processing computer.” But for the Wisconsin Alumni Research Foundation — the research arm of the University of Wisconsin-Madison — it’s now worth half a billion dollars.

On Monday, a federal judge ordered Apple to pay WARF $506 million for infringing upon that patent.

The foundation sued the tech giant in 2014, arguing that Apple used its technology without licensing it in its A7, A8 and A8X processing chips, which power iPhones and iPads. The following year, a Wisconsin jury found that Apple indeed infringed upon the patent and said the company should pay $234 million in damages.

U.S. District Judge William Conley in Madison more than doubled Apple’s tab Monday, ordering the Cupertino, Calif., company to pay $1.61 in damages and $2.74 in royalties for every unit containing the technology from the ruling in October 2015 to December 26, 2016, when the patent expired. Including interest, that amounts to $272 million — bringing the combined sum to $506 million.

Apple is appealing the ruling, according to the court papers, but did not respond to requests for comment.

“WARF will continue to defend the work of the university researchers and WARF’s patent in this case should Apple, Inc. file an appeal,” said WARF spokeswoman Jeanan Yasiri Moe.

Moe declined to comment further on the litigation details.

The University of Wisconsin has a unique history in finding ways to profit off licensing.

The first university-affiliated patent office was born nearly a century ago when UW biochemist Harry Steenbock discovered that irradiating food increased its vitamin D content. According to Bloomberg, Quaker Oats offered Steenbock $1 million for the patent, but he instead chose to let the university sign an agreement so that all the revenue would go toward funding research.

To date, the University of Wisconsin has raised $300 million for research and faculty inventors from the vitamin D patent alone.

In 1925, it set up a dedicated licensing office; other universities soon followed suit.

Patents are a major way that research foundations aid their universities. In 2016, WARF filed 168 of them, good for sixth most in the country. It currently holds more than 1,800 active patents.

Universities use patent licensing — and the huge payouts they get from companies sued for using them without permission — to fund other programs. WARF averages around 50 revenue-generating licenses each year.

WARF sued Sony for patent infringement in 2003, Samsung and IBM in 2004, and Intel in 2008. All four resulted in settlements.

In turn, money from those payouts goes to programs like the GBeta program, which helps evolve university-patented technology into profitable start-ups and businesses. According to the Milwaukee Journal Sentinel, four GBeta programs have produced 20 start-ups that together raised more than $1.5 million in funding during their first year.


UPDATES:

3:20 p.m.: This article was updated to include additional context about the history and operations of the Wisconsin Alumni Research Foundation.

This article was originally published at 10 a.m.

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