Apple hit with $1.4B lawsuit by Chinese AI firm over Siri technology

A Chinese AI firm announced Monday that it has filed a patent-infringement lawsuit against Apple, which could prevent the tech giant from selling certain products in the important Chinese market, according to a report.

Shanghai Zhizhen Network Technology Co. -- also known as Xiao-i -- announced it is suing Apple for 10 billion yuan ($1.43 billion) in damages in Shanghai court after the Chinese company recently acquired a patent for a voice assistant whose technical architecture is said to be similar to Apple's Siri, The Wall Street Journal reported.

Apple introduced the voice-activated intelligent assistant Siri in 2011. Since then, it has helped smartphone and laptop users enable functions such as alarms and reminders as well as send texts or call someone without having to pick up the device.

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Xiao-i did not immediately respond to FOX Business' requests for comment.

As part of the lawsuit, Shanghai Zhizhen Network Technology Co. is asking the tech behemoth to stop the sale, production and use of its products that have the patent, which encompasses the vast majority of Apple's products.

In June, following an eight-year legal battle, China's Supreme Court ruled that Shanghai Zhizhen owns the patent for the technology in China, the Journal reported, adding that the company can apply for a preliminary injunction.

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If the injunction, which has to meet strict conditions, is issued, the court could ban Apple from selling its Siri-enabled products in China while the trial persists, Fang Jianwei, a former Chinese judge who is now a litigation partner at Zhong Lun Law Firm in Shanghai, told the Journal.

Fang noted that such injunctions, however, are rarely approved. Furthermore, he added that although the Supreme Court ruled in favor of Shanghai Zhizhen, the current court could still rule in favor of Apple if the technology behind the voice assistants is found to be different enough.

However, Apple told FOX Business in a statement Monday that the company "deeply respects innovation, and our teams work tirelessly to create new technology and product features" for customers.

"Siri does not contain features included in their patent, which relates to games and instant messaging, and we are disappointed Xiao i Robot has filed another lawsuit," Apple said. "Independent appraisers certified by the Supreme People’s Court have also concluded that Apple does not infringe Xiao I Robot’s technology."

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The news comes after Apple posted sales growth, though slim, in the greater China region amid the COVID-19 pandemic.

Last week, the company noted that sales in the region rose to $9.33 billion over the three-month period ending June 27, according to the company's earnings report.

“China remains a key ingredient in Apple’s recipe for success as we estimate roughly 20% of iPhone upgrades will be coming from this region over the coming year,” Daniel Ives of Wedbush Securities said in a note, Reuters reported.

China is the No. 2 market in terms of Apple sales, behind the U.S., the Journal reported.

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This story has been updated to include a statement from Apple