Apple hit with $1.4B Lawsuit in Siri Patent

Yahoo Finance's Dan Howley joins the On the Move panel to discuss a lawsuit that could impact Apple's ability to sell many of its products in China.

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JULIE HYMAN: Well, Apple shares are up about 3% today. This is even after-- there's a threat of a lawsuit that has to do with the technology behind Siri. Apparently, a Chinese company filed for a patent for similar technology or was awarded a patent. And so is this a real threat, though? They're suing Apple over this. Is this a real threat that they might not be able to have Siri in other countries?

DAN HOWLEY: Yeah, it looks like in China they basically are going after Apple, as far as all of their devices with Siri, which are all of their devices. So there's going to have to be some kind of, I guess, reconciliation between this patent and what Apple offers. It's just interesting to see that this is only the China patent. It only applies there.

But China makes up a huge chunk of Apple's sales. And we talk constantly about China, where the iPhone is selling, how the services are selling, how the iPad and Mac are selling in that region. It's incredibly important to the company and continues to be.

They've been kind of thrown into the thick of it as far as the trade war goes. They've been jockeying with President Trump to ensure that their products aren't hit by any tariffs as a result. Now, they're know, being kind of looked at by the Chinese government with, you know, a look towards retaliating against the US because of Huawei.

So I think this is just kind of another step in the wrong direction for Apple and its China relations. But I really don't think that it's going to stay for very long.

ADAM SHAPIRO: Dan, you know, "The Wall Street Journal" article on this pointed out the Chinese patent was just recently awarded. Siri's been around long enough for many of us to remember when we couldn't stand it because we didn't think it worked that well. But is this the Chinese version of a patent troll? Is that what Apple is facing here?

DAN HOWLEY: It kind of seems like it, right? I mean, the patent has been-- it's specifically the China patent. It's not a global patent or anything like that. So I think, really, what it comes down to is China being able to say, OK, look, this company has made a similar technology. Apple has its existing technology, but that doesn't preclude this company from coming in and having its own patent and then this company coming forward and saying, look, if our technology is the same as Apple, we're going to go after them.

And I think that's something that, you know, plays into the idea of this back and forth with the big tech companies for both countries being kind of a ball for these two governments to kind of play with as they go about their geopolitics and trade war action.

JULIE HYMAN: Dan, thank you.