Apple Taction $5.7bn Patent Verdict: Why It Shrinks, and Why Apple Still Pays
A San Diego jury has returned the largest patent award in US history against the Taptic Engine. Earlier billion-dollar verdicts against tech companies have mostly been cut or overturned on appeal, and this one probably will be too. Because both patents run until 2035, though, Apple is looking at a settlement in the low billions.
On Friday a federal jury in San Diego found that Apple owes Taction Technology more than $5.7 billion for infringing two patents on bass-frequency vibration. The patents cover the Taptic Engine in iPhones and Apple Watches. Law360 says the award is the largest patent verdict in US history, about two and a half times the $2.18 billion VLSI won against Intel in 2021. Apple says the damages are "entirely unsupported by the facts" and that it will appeal. Taction is a small company that makes headphones.
The verdict will probably shrink, but Apple's exposure is harder to reduce. Very large patent verdicts against technology companies have tended to fall apart after trial, and the Federal Circuit has recently tightened the rules on damages experts. Both Taction patents stay in force for about another nine years, however, and every Taptic Engine Apple ships in the US until they expire adds to the liability. Our estimate is that Apple ends up paying between $1.5 billion and $2.5 billion, including a licence for future sales. That would be less than the jury awarded and more than earlier cases suggest.
The jury found infringement of claims in US Patents 10,659,885 and 10,820,117. Both were granted in 2020 and claim priority to 2014, which gives them an expected expiry in 2035. The jury found that Apple did not infringe wilfully. That finding rules out enhanced damages of up to three times the award, a point that will matter in any settlement talks. Taction filed suit in 2021. Apple had the case dismissed in 2023, and the Federal Circuit reinstated it last year because the lower court had wrongly excluded some of Taction's expert testimony. According to Bloomberg Law, discovery showed the case was funded by Gronostaj Investments and Kenosha Investments, which separate litigation identified as an indirect subsidiary of Burford Capital.
Earlier cases suggest the likely path. Intel's $2.18 billion loss to VLSI, a litigation vehicle backed by Fortress, was overturned by the Federal Circuit in December 2023. Caltech's $1.1 billion award against Apple and Broadcom in 2020 was vacated on damages in 2022 and later settled for an undisclosed sum. The exception is Masimo. Its $634 million verdict against Apple over Watch sensors survived Apple's post-trial motions in July, and Masimo is now seeking about $243 million in interest on top. That award is roughly a ninth of Taction's.
The main legal problem for Taction is EcoFactor v. Google. In May 2025 the full Federal Circuit ruled that trial judges must screen damages experts before they testify, and it vacated a $20 million award because the expert's per-unit royalty rate went beyond what the comparable licences supported. A $5.7 billion award for a single vibration component depends on a royalty rate that Apple's lawyers will attack under EcoFactor. Apple's argument that Taction's own testing found the Taptic Engine "fundamentally different" goes to infringement and will be heard by the same judge. For scale, the award is about five days of Apple's revenue. Apple can afford to pay it. It will still challenge the rate hard, because the rate sets the price for the next patent holder.
The case for the full award is that juries seldom land on numbers like this at random. Taction's lawyers at Quinn Emanuel had five and a half years to build a royalty model, and the Federal Circuit panel that revived the case already sided with Taction once on expert evidence. Masimo also shows that a California federal court will uphold a large verdict against Apple over a watch component. If the district judge refuses to intervene, Apple's appeal will not be decided until about 2028, and post-judgment interest will build up in the meantime.
We accept that reasoning on liability and not on the amount. Upholding infringement findings is routine. Upholding billion-dollar royalties against component features after EcoFactor is not. The award's size also works against it: a figure far above anything a court has previously approved will get the closest possible scrutiny on appeal.
The patents' remaining term matters more. They run to 2035, so if liability is upheld, Taction can seek an ongoing royalty on Taptic Engines sold after the verdict, and the jury's rate will be the starting point for that negotiation. Apple can redesign around the patents, but that takes years and is itself costly. That is why we expect a settlement in the low billions. Taction's case on the amount is weak, but its case for ongoing royalties is strong. A settlement also saves Apple years of discovery into funder arrangements that it pursued aggressively throughout this case.
For Burford, the figure has both a positive and a negative side. Burford reports its capital provision assets at fair value, so a verdict of this size should raise the carrying value of its stake if the Kenosha link is confirmed. VLSI shows the other side: a fund's gains from an unresolved verdict can disappear at the Federal Circuit. Investors should wait for cash from a settlement before crediting the gain.
The broader signal for patent holders is that litigation funders will now finance cases against individual components, such as a haptic motor or a sensor, rather than against a whole device. Every phone contains dozens of such parts. A small company with two patents and a funder can now go after a single component and still reach a multibillion-dollar damages figure. Apple, Samsung and Google will respond by pushing for disclosure of funding and for stricter screening of damages experts, and courts have already been moving that way.
Post-trial motions should be filed within weeks. We expect the judge to rule in the first half of 2027 and to order either a new trial on damages or a substantial reduction while leaving the infringement finding intact. We expect Apple and Taction to settle after that ruling and before the Federal Circuit hears the appeal, most likely in 2027.