Skip to comments.RIM's U.S. sales future in judge's hands (Blackberry Maker Accused of Patent Infringement)
Posted on 11/30/2005 1:39:56 PM PST by nickcarraway
BlackBerry maker Research In Motion's attempt to enforce a $450-million-US settlement with NTP Inc. was denied today by an American judge who now will consider whether to block sales of the e-mail device in the United States.
RIM shares (TSX:RIM), which were halted before the judge's ruling, fell $5.62 or 7.4 per cent, to $70.38 after trading resumed in Toronto. In New York, where a higher volume of the stock is traded, the shares fell $4.38 to $60.54 US.
U.S. District Judge James Spencer's decision in Richmond, Va., is a victory for NTP Inc., a Virginia-based patent company that maintains the technology behind the popular BlackBerry wireless e-mail products infringes on its patents.
The Waterloo, Ont.-based company had sought to uphold an agreement reached earlier this year between the two companies that NTP said was never finalized.
Spencer said the ``court finds the parties do not have a valid and enforceable settlement agreement.'' He also said he'd schedule further hearings to consider the remaining issues between the parties.
There has also been concern that BlackBerry service, which is used widely in the U.S. public sector including its military, homeland security, police and fire services, could be disrupted if an injunction is granted.
However, analysts and industry observers expect that, instead, RIM will eventually be forced to negotiate a sum as high as $1 billion US to settle the dispute.
Flushed with cash from earlier financings and strong profits, the Canadian company could well afford to pay such an amount but has waged a protracted legal battle in the U.S. courts and at the U.S. patent office, which has conducted a separate review of the matter.
In a statement, RIM said it will continue to press ahead with a request that the U.S. Supreme Court review the patent infringement case. p``While further review by the Supreme Court is generally uncommon, RIM continues to believe this case raises significant national and international issues warranting further appellate review,'' the company said from Waterloo.
James Wallace, a lawyer for NTP, said Spencer's ruling was ``pretty much as predicted'' and indicates the judge is going to move quickly to conclude the case.
``We would hope that these developments would bring the parties back to the table to resolve this matter,'' Wallace told The Associated Press.
Meanwhile, RIM said it has been preparing software designs it intends to implement if necessary to maintain operation of BlackBerry services in the United States if an injunction on new sales of the e-mail device is imposed by the U.S. court.
``RIM is reviewing any potential accounting implications of the latest developments and will provide a further update as soon as practicable,'' the company said.
The stakes are huge for RIM, one of Canada's leading high-technology companies thanks to the market success of the BlackBerry in the United States and around the world.
``RIM, right now, is by far has the largest number of users on any system. No one is even close,'' National Bank Financial analyst Deepak Chopra said.
``I don't think any one company is capable of satisfying the user base like RIM is,'' Chopra said.
Among the companies that sell wireless e-mail hardware, software or services that potentially compete with the BlackBerry, are Palm Inc., Good Technology Nokia Corp., and Microsoft Corp.
Palm's shares (Nasdaq:Palm) gained $1.20 to $27.97 US in New York, a 4.5 per cent gain from Tuesday. Nokia (NYSE:NOK), which has licenced technology from RIM for its products, saw its shares fall 24 cents or 1.4 per cent to $17.09 US.
Shares of Microsoft (Nasdaq:MSFT), which is upgrading versions of its Outlook e-mail server software to route traffic to a variety of wireless devices, traded at $27.76 US, up eight cents. RIM has the bulk of its workforce in Waterloo but has announced plans to spend $230 million over five years to set up a technical support centre in Nova Scotia, bringing 1,250 jobs to the city of Halifax.
Another moronic article about patents that does not actually tell us the patent number!
NTP: "Patent Troll"
I'm not clear on who infinged who.
Follow the money and you will determine the outcome of this decision.
I think this is more about money than patent. Also, NTP Inc. exist only on paper.