Apple, others hit by predictive text lawsuit

Apple is one among many companies named in a new lawsuit filed by Autotext Technologies, accusing businesses of violating a key patent, while a second New York lawsuit stemming from the stock options scandal was dimissed. Autotext in 1994 patented a technology called "computer-based transcription," which attempts to predict entries during word processing, offering suggestions as users type; because this concept is now almost ubiquitous, Autotext is suing 23 companies, among them Apple, AT&T, IBM, LG, Microsoft, Nuance, Nintendo, Sony, T-Mobile and Verizon. Cellphone makers are a particular target due to Nuance's T9 format, while Apple is subject as a result of Mac OS X 10.4 and Safari.

Autotext is owned by Acacia Research, whose sole business is acquiring and licensing patents. The company was in August accused of frivolous infringement litigation by a northern California judge, who was asked to rule in a suit dubbed Micromesh Technology Corp. v. American Recreational Products.

In a victory for Apple bosses, the company's legal team has managed to win a dismissal of a shareholder lawsuit, one which claimed that executives such as CEO Steve Jobs illegally backdated stocks for personal gain. By doing so, said members of the New York City Employees' Retirement System, Apple's real stock prices were devalued.

District Court judge Jeremy Fogel granted the dismissal by noting that Apple stock had not been altered in any noticeable way, meaning there were no damages to recover. "While the subsequent disclosure that the options were backdated might require a restatement," reads Fogel's ruling, "without a discernible drop in the stock price there is no basis upon which to establish an injury to shareholders."

The suit can still be refiled however, so long as it is phrased as a derivative case arguing that the company was hurt, not the shareholders. The suit would then likely be absorbed into an existing one.