A ruling of the U.S. International Trade Commission (ITC) decided that Apple products did not, in fact, violate patents held by S3 Graphics, which recently became a subsidiary of the Taiwanese mobile device manufacturer HTC. According to the Wall Street Journal, HTC is now being questioned for going through with the $300 million acquisition deal.
The news source reports that the ITC's ruling is a reversal of an earlier decision wherein it found Apple in violation of S3's texture compression patents for smartphone and smartphone accessories technology. This altered decision effectively ends the investigation, leaving HTC with no further legal recourse.
Additionally, as an indirect result of the ruling coming out in Apple's favor, injunctions might be filed against HTC products in relation to separate claims that it violated intellectual property belonging to Apple.
In separate statements, HTC's CFO Winston Yung defended the acqusition of S3 in spite of the legal defeat, while the company's general counsel Grace Lei stated that it was considering an appeal but would abide by the ITC ruling in the meantime. Apple released no official comment.
According to Bloomberg, HTC's stock shares dropped by 6.1 percent as of 10:45 a.m. Taipei local time, one of the biggest declines in trading the company has experienced in nearly two months.