Bloomberg News

Research In Motion Wins BlackBerry Patent Ruling

December 01, 2005

Research In Motion Ltd. (RIM), the maker of BlackBerry e-mail pagers, won a ruling from the U.S. Patent and Trademark Office that one of the patents at the center of the company's dispute with NTP Inc. is invalid.

The patent office issued what it called a ``non-final action'' yesterday saying one of five patents owned by NTP involved in the case is invalid. The agency is still reviewing another patent found to be infringed by Research In Motion.

A final decision on the patents could be years off, said NTP lawyer James Wallace. U.S. District Judge James R. Spencer took note of that in a ruling yesterday, allowing the underlying patent suit against Research In Motion to proceed. The company is facing a possible halt to its BlackBerry service in the U.S.

``There are going to be lots of interim rulings,'' Wallace said. ``When the whole patent office actions are over with and all the appeals are done, then I will comment on it.''

A spokeswoman for Waterloo, Ontario-based Research In Motion didn't immediately return an e-mail seeking comment.

This is the second time the patent office has issued a determination that the patent should be canceled. It said that NTP must make some changes to get the patent confirmed.

``The next office action is expected to be a final rejection,'' the agency wrote. From there, NTP could appeal to a board within the patent agency and then to federal courts.

There were five patents involved in the lawsuit first filed by NTP in 2001. A finding of infringement on elements, or claims, in two patents were upheld on appeal.

Some claims of infringement were thrown out, while others were sent back to Spencer for reconsideration. Those two aspects of the ruling involved elements of all five patents.

Research In Motion shares rose $3.89 to close at $65.02 in Nasdaq Stock Market composite trading.

Yesterday, Spencer also rejected as ``unenforceable'' a draft agreement between the two companies in which Research In Motion would pay NTP $450 million. Each side blames the other for the breakdown in the agreement.

The lawsuit is NTP Inc. v. Research In Motion Ltd., 01cv767, U.S. District Court, Eastern District of Virginia (Richmond).

To contact the reporter on this story: Susan Decker in Washington at sdecker1@bloomberg.net.

To contact the editor responsible for this story: Patrick Oster at poster@bloomberg.net.


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