Cisco Systems Inc. was ordered today to pay $1.89 billion after a judge ruled that the networking giant infringed four patents belonging to cybersecurity company Centripetal Networks Inc.

The case, bought by Centripetal, alleged that Cisco had infringed its patents relating to the company’s Threat Intelligence Gateway network protection system under Title 35 of the United States Code. The patented technology was funded in part by a grant from the U.S. Department of Homeland Security, with the patents awarded between 2015 and 2018.

Patent trolling is rife within the broader technology sector including cybersecurity, but where this case takes a twist is that Centripetal claims that Cisco breached their patents after both companies discussed a partnership in June 2017. “The fact that Cisco released products with Centripetal’s functionality within a year of these meetings goes beyond mere coincidence,” U.S. District Court Judge Henry Morgan said in his ruling.

The judge was damning, saying that “Cisco did not advance any objectively reasonable defenses at trial” and that “the infringing functionality was added to their accused products post June 20, 2017 and resulted in a dramatic increase in sales which Cisco touted in both technical and marketing documents.”

Cisco in its defense claimed that the cybersecurity features were developed before Centripetal even existed and that Centripetal’s claim to have lost business was because its ideas were too complicated. Centripetal claimed in its lawsuit that its sales had been doubling each year from 2015 until the point where Cisco allegedly copied its features.

“We are disappointed with the trial court’s decision given the substantial evidence of non-infringement, invalidity and that Cisco’s innovations predate the patents by many years,” Cisco said in a statement.

Judge Morgan ruled that Cisco pay Centripetal $755.8 million in damages, multiplied by 2.5 to reflect what he referred to as Cisco’s “willful and egregious” conduct, plus prejudgment interest. The trial and the ruling were held via Zoom because of the COVID-19 pandemic.

Cisco said it would appeal the decision to the U.S. Federal Circuit Court of Appeals.

Although the ruling could be considered costly, the payment, should Cisco be forced to make it, would be a small blip on the company’s overall financials. As of its last quarter, Cisco booked revenue of $12.15 billion. Investors were not in the least bit concerned as Cisco shares barely moved up less than a point in regular trading on the Nasdaq, to $38.57 per share.

Photo: Cisco