If you were to ask Apple, eighth-grade dropout Patrick Racz is just a “Patent Troll” with no inventions but an axe to grind. But having already chased the tech giant for $530 million, Racz has his sights on a much bigger prize, provided he can prove Apple stole its legendary iTunes idea from the inventor.
Racz is locked in the middle of an $18 billion lawsuit against Apple, accusing the group of stealing his patent for the storage of music and videos through a software solution.
The inventor filed another lawsuit with the US Patent and Trademark Office (USPTO) in October to force the group to disclose documents related to his case against Apple, indicating he has no intention of pulling back any time soon.
‘A deep depression’
Private investors back Racz in his drawn-out and expensive pursuit of Apple for damages.
“The technology I invented allowed Apple to become the biggest company in the world, and I still haven’t earned a penny,” Racz told the Times of London last year. “After 21 years of fighting for justice, the time has come for me and my long-suffering investors to finally get paid.“
But in an interview with the Guardian, Racz has detailed how a lengthy legal fight with Apple has left him ostracized from the tech community and with few friends in the industry as he finds himself labeled a patent troll from most corners.
He has also faced death threats.
“Those things start to sting – when you’re told that your kids should be burned at the stake and that you should be beheaded for what you’re doing,” Racz told the Guardian. He now says the fight with Apple has become his legacy.
‘Tap man’ turns on Apple
Racz made his fortune from a three-prong mixer tap that would distill hot, cold, and filtered water to its owners. After selling Avilion, the company behind the tap, Racz turned his eye toward music software.
After setting up Smartflash in 2000, Racz obtained patents on systems that would store media including songs and videos. He says he discussed the idea with a technologist who would go on to become a senior director at Apple.
He also discussed it with Gemplus, a company that later partnered with Apple and used the product, he claims in his lawsuit.
“From that point on, virtually every product they launch incorporated my technology in some way, shape or form,” Racz said of the launch of iTunes in 2003, the Times of London reports.
“I went through a period of deep depression,” Racz told the Guardian of seeing his attempts at a second fortune wiped out in the dotcom boom while Apple launched its iTunes platform.
“I’m ashamed to say I hit the bottle. I was totally lost in a haze of time and I couldn’t remember a lot.”
Racz filed for a patent soon after he created the software but didn’t obtain it until 2008, setting off his legal challenge against the $2.96 trillion company.
He has had minor successes during his long, tumultuous patent fight with Apple, but nothing long-lasting.
Back in 2015, a judge ordered Apple to pay $532.9 million to Smartflash LLC for willful infringement of three U.S. patents.
As soon as he won that verdict, Racz and Smartflash pursued the company and other tech groups, including Google and Amazon, for four more patent infringements.
Two years later, though, Racz saw the decision quashed by an appeals court, which argued Smartflash’s patents were invalid. He failed in his own appeal attempts, leading to the latest rampage against the group.
A representative for Apple didn’t immediately respond to Fortune’s request for comment.
However, a representative recirculated a past comment it published in 2015 with the Guardian.
“Smartflash makes no products, has no employees, creates no jobs, has no US presence, and is exploiting our patent system to seek royalties for technology Apple invented,” the representative said.
“We refused to pay off this company for the ideas our employees spent years innovating and unfortunately we have been left with no choice but to take this fight up through the court system.”
