Cisco is fined 2 billion for copyright infringement. The company has been convicted of using cybersecurity patents without permission.
The fine amounts to $ 1.9 billion and Cisco has to pay overdue royalties to Centripetal Networks on top of that. A court in the US state of Virginia has ruled this.
According to that court, the networking giant has violated four patents in an “idiosyncratic and blatant way”, which immediately explains the high fine.
In addition, Cisco will also have to hand over royalties on certain products to Centripetal Networks for the next six years. They would be between $ 168 and $ 300 million for the first three years and between $ 84 and $ 150 million for the next three years.
The patents that were infringed belong to a Virginia company that designed a security system for networks, partly funded by the US government.
Centripetal Networks explained that system to Cisco after it signed a nondisclosure agreement on the pretext that the tech giant wanted to buy the technology. However, Cisco simply took over the functionality and Centripetal filed a lawsuit.
The fine is very high for this type of lawsuit but equates to approximately three months of revenue for Cisco. The company has already said it will appeal.