By Blake Brittain

Apple Inc on Monday failed to convince a U.S. appeals court that security startup Corellium Inc infringed its copyrights by simulating its iOS operating system to help researchers find security flaws in Apple devices.

The 11th U.S. Circuit Court of Appeals said Corellium lawfully recreated Apple's system under the U.S. copyright doctrine of fair use, furthering scientific progress by aiding important security research.

Representatives for the companies did not immediately respond to requests for comment on the decision.

Florida-based Corellium's software allows users to run iOS on non-Apple devices and inspect and modify the operating system in ways that allow security researchers to search for vulnerabilities more effectively. Apple sued Corellium for copyright infringement in South Florida federal court in 2019.

Apple unsuccessfully tried to buy Corellium for nearly $23 million before filing the lawsuit, the appeals court said.

The district court dismissed Apple's claims over Corellium's iOS simulator in 2020. Apple appealed in 2021.

The 11th Circuit agreed that Corellium made fair use of iOS on Monday and said Corellium's software adds new features that help security researchers "do their work in a way that physical iPhones just can't."

The appeals court rejected Apple's arguments that Corellium simply repackaged iOS in a different format for profit, harming Apple's market for its operating system and its security-research programs.

Corellium "opened the door for deeper security research into operating systems like iOS," the circuit court said.

The appeals court sent the case back to the district court to consider if Corellium infringed copyrights covering Apple's icons and wallpapers or contributed to infringement by third parties.

(Reporting by Blake Brittain in Washington)