Bloomberg News

Palm Wins Delay of NTP's Wireless E-Mail Lawsuit

March 22, 2007

Palm Inc. won a court order delaying NTP Inc.'s patent-infringement lawsuit over wireless e-mail service while U.S. officials review the inventions.

Palm, maker of the Treo wireless e-mail phone, asked U.S. District Judge James R. Spencer in Richmond, Virginia, to put the case on hold in hopes that the U.S. Patent and Trademark Office would nullify the six disputed NTP patents. Spencer granted Palm's request today, according to court records.

``We are extremely pleased with the court's decision to grant a stay,'' Mary Doyle, Palm's general counsel, said in a statement. ``We hope and expect that the PTO's review of NTP's patents will confirm the decision of the examiners to reject them all and so avert the need for further litigation.''

NTP, based in Richmond, is appealing the agency's rejection of the patents. Spencer heard arguments on Palm's request for a delay on Jan. 31.

``NTP's patents remain fully enforceable,'' NTP said in a statement. ``The ongoing 'reexamination' by the U.S. Patent and Trademark Office is one step in a process that could end in the federal court system, including the Court of Appeals, which previously upheld NTP's patents.''

Shares of Palm fell $1.71, or 8.8 percent, to $17.74 in Nasdaq Stock Market trading at 4 p.m. New York time after Merrill Lynch & Co. said Motorola Inc. is unlikely to acquire the Sunnyvale, California-based company.

Spencer also presided over the case that ended last March when Palm rival Research In Motion Ltd. (RIM), maker of the BlackBerry handheld e-mail device, agreed to pay $612.5 million to NTP. The judge refused to delay that case because the patent office review began after Research In Motion had lost a jury trial. Five of the six patents in Palm's case were part of the suit against Research In Motion.

The case is NTP Inc. v. Palm Inc., 06-cv-836, U.S. District Court, Eastern District of Virginia (Richmond).

To contact the reporter on this story: Jeff St.Onge in Washington at jstonge@bloomberg.net.

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


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