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TechScape: Of RIM, NTP and BlackBerry Squash

Patently obvious

Designing a Defense for Mobile Applications

Rant The other day in the FT, there was a small item about RIM (Research in Motion) the Blackberry’s manufacturer. Its headline blared, “RIM Faces Higher Payouts on Patents.”

Turns out, RIM “may have to pay-out $550m more than the $450m it has set aside to settle claims that its Blackberry email device infringes the patents of another company.

Now call me exceedingly gullible or something (though nobody has ever called me something), but I stupidly thought that RIM owned the IP rights free and clear to the Blackberry.

To recap, on 5 August, 2003 the US District Court issued a "Final Order" awarding almost $54m including post-judgment interest, compensatory damages and enhanced damages while finding "that NTP will face irreparable harm if a injunction is not issued".

This was more than two years ago.

The court also issued the injunction against RIM forbidding it to:

"indirectly or directly making, using offering to sell or selling within the United States any or the following products or services:

i. Blackberry Handheld Units (model numbers 850, 857, 950, 957, 5810, 6710, 6510, 6210, 6750)

ii. RIM's Blackberry "Corporate" Redirector Software (for Microsoft Exchange Server and Lotus Domino)

iii. RIM's Blackberry "Desktop" Redirector Software

iv. RIM's Blackberry "ISP" Redirector Software

and ... drum roll, please,

v. RIM's Blackberry Wireless E-mail Service in connection with any of the foregoing products.

RIM shot

Following the ruling, RIM went immediately to the US Patent Office which is tantamount to asking another student for help when you, the schoolyard bully have been punched in the face by a peon you regularly tortured.

After a few minor but highly-publicized Patent Office triumphs, RIM did what any un-self-respecting loser would do: it went to NTP and began negotiating a settlement, which now stands at $450m - that NTP won't accept. From a $54m judgment to pay NTP to a $450m settlement offer? Hard to believe, but tiny NTP must have had some serious negotiating leverage to get RIM to up its offer by more than $395m. And turn them down.

NTP, a technology-licensing company whose president and holder of 50 patents died last June, is now holding out for $1bin. And I hope they get it. It’s time for big, rich companies to start paying up to the smaller ones who claim they damaged them and can prove it in a court of law.

“The $1bn estimate,” of what RIM owes the company they damaged, “followed the refusal of the US Appeals Court to overturn a jury finding of infringement of the patents. RIM faces a court order halting the Blackberry service in the US if it cannot get the verdict thrown out.”

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