Tuesday, February 28, 2006

Questioning the Workaround

An AP article in the Toronto Star by Tyler Hamilton notes the discrepancies between two sets of statements by RIM. On one hand the company claims it’s customers face potential disaster if an injunction against its email service is issued, but on the other hand it says it has a well-tested workaround ready to go in the advent of such an injunction.

Given these two sets of statements the Judge hearing the case is questioning why doesn’t RIM put the workaround in place now. If that is truly his feeling then this indicates both that his is inclined to issue an injunction but at the same time will not issue an immediate injunction against the workaround, something that NTP will no doubt request.

Fight Over Third Party Licensing

The Globe and Mail reports that RIM and NTP each issued press released on Monday, focusing on the licensing terms that NTP is offering RIM for a settlement. In a press release NTP claims that any settlement would cover RIM’s customers, wireless carriers and partners. RIM says the actual terms indicate the opposite and this is what’s holding up a settlement.

Friday, February 24, 2006

More reaction

RIM co-CEO Jim Balsillie is quite happy and confidence in a TV interview following the ruling, The Globe and Mail reports:

Never, ever, ever have they (NTP) put up true ‘patent peace' as a form of settlement,” he said.
As well, he referred to the second of two NTP patent claims being finally rejected by the U.S. Patent Office earlier Friday: “These patents are just gone.”

Judge: No Immediate Injunction


RICHMOND, Va. - A judge Friday stopped short of ordering an immediate shutdown of millions of BlackBerry portable e-mail devices made by Research In Motion Ltd.
But U.S. District Judge James Spencer said there was no escaping that RIM had been found to be infringing on NTP Inc.’s patents and he would issue a decision on an injunction “as soon as reasonably possible.”

NTP Says RIM Politically Powerful Bully

NTP is accusing RIM of using money, power and political influence to influence the actions of the U.S. Patent and Trademark Office. One charge is that than Liberal Minister of Industry, David Emerson wrote to U.S. Commerce Secretary Carlos M. Gutierrez asking for the patent office to publicize its timetable for the patent reviews, which it soon did.

RIM denies the charges of political influence.

Thursday, February 23, 2006

Experts Divided On a Shutdown

On ZDNet’s IP Telephony, VoIP, Broadband blog, Russell Shaw asks eight experts if there will be an injunction issued against RIM. Most think there will not, but in a follow-up postings Shaw quotes from Troy Wolverton of TheStreet.com who thinks there will be an injunction issued while Todd Kort, a senior analyst at Gartner argues against a shutdown.

Key points for a shutdown:

  • The sides will not settle out of court.
  • An injunction is standard practice and the Judge is impatient with RIM’s arguments.
  • RIM’s response to an injunction will be its workaround.
  • If used, the success of the workaround in keeping BlackBerry email service working will determine RIM’s future actions.

Wednesday, February 22, 2006

First Final Patent Rejection

On Wednesday the U.S. Patent and Trademark Office issued a final rejection of NTP Inc.’s, patent with rejections of the remaining four patents expected. There is no indication if U.S. District Judge James R. Spencer will take this rejection into account during any upcoming rulings.

This blog's URL, 960-patent-lawsuit.blogspot.com is named after the patent in question - Patent #5,436,960.

Globe and Mail's Lawsuit Hub

The Globe and Mail nows has a RIM-NTP Lawsuit related page, including a summary of the possible impact of Friday's possible ruling.

Tuesday, February 21, 2006

Department of Justice Hearing Rejected

Reuters reports that U.S. District Judge James Spencer turned down a request by the U.S. Justice Department to hold a separate hearing on its concerns about the potential BlackBerry email service shutdown.

Monday, February 20, 2006

Call For A Settlement

An Associated Press article on MSNBC.com takes the view that neither Research In Motion Ltd. or NTP Inc. is likely to yield in the patent case leaving both to vulnerable to whatever decisions a clearly impatient US district judge James R. Spencer may decide.

The article suggests an increased one-time settlement to NTP without further royalties, which would eliminate the cloud over RIM while ensuring that NTP does not lose everything if its patents get thrown out.

Globe and Mail's Week Long Series

The Globe and Mail starts a week-long series on RIM and its patent fight against NTP Inc in the days leading to Friday’s possible injunction ruling.

  • Monday: co-CEO Jim Balsillie’s background and early business experiences.
  • Tuesday: BlackBerry use and abuse.
  • Wednesday: BlackBerry rivals.
  • Thursday: The Judge
  • Friday: RIM would settle for a one time payment.

Friday, February 17, 2006

RIM: Still Open for A “Reasonable Settlement”

CNN (via Reuters) reports that RIM CFO Dennis Kavelman states that the company is still open to a reasonable settlement. The article reports:

"We haven't shut down communications" with NTP, said CFO Dennis Kavelman at a CIBC World Markets conference.
"You know if there's a reasonable settlement opportunity that we'd be there. I think we showed last year that we were willing to settle that."

However in case a settlement failures RIM has very strong contingency plans but still expects to lose some customers who would rather not install new software to use the workaround.

Wednesday, February 15, 2006

NTP Says RIM Can ID Gov't Users

In a court filing NTP Inc. stated that RIM should bear the burden of identifying government workers would be exempt from a possible court ordered shutdown of RIM’s BlackBerry email service in the United States. It argues that RIM “mislead” the US government about its ability to identify the estimated 1 million government users of its service which it notes cost the government about $40 a month in subscription fees.

The Globe and Mail’s article notes the impact of RIM’s workaround and the expected NTP challenge to it if it needs to be put in place.

NTP reiterated its request for an immediate injunction on new BlackBerry sales, noting that RIM is selling more than 7,000 devices each day. RIM and its carrier partners can readily comply with such an order, the filing said.

Should the judge comply with this request, RIM would likely seek an immediate stay of the injunction from the Court of Appeals for the Federal Circuit. It would also presumably put the workaround into effect immediately. NTP is expected to challenge the workaround by filing a motion for contempt of court. If the motion is granted, the leverage would fall heavily in its favour. If it's not, leverage would swing to RIM, assuming the workaround works as advertised.

Saturday, February 11, 2006

RIM's Legal Firm Switched Sides

The National Post looks at surprising twist in the RIM-NTP lawsuit. In March 2005 GMP Securities LP, a Toronto-based investment firm which was one of RIM’s leading underwriters and whose lawyers handled the private business affairs of RIM’s executives stunned RIM by advising NTP Inc. in its lawsuit against RIM.

RIM’s main concern about this decision was that GMP Securities had access to RIM’s more detail information and secrets. GMP Securities said they only used publicly available information when advising NTP but with its executives very angry, RIM is blacklisting GMP Securities. The article states:

So now, RIM has refused to provide references when other companies have enquired about doing business with GMP. In the words of one official, "If we're not on their reference list and you're a CEO, wouldn't you ask why?"

Friday, February 10, 2006

BusinessWeek Workaround FAQ

BusinessWeek has a FAQ on the workaround, which includes a description of the main modification that it would put in place:

How does it work?
It would work by changing the part of the network where e-mails are stored. Right now, when someone is out of wireless coverage range and can't immediately get e-mail access, RIM's service stores incoming messages on computers at one of its two network operations centers, or NOCs. When you come back into coverage range, those e-mails are forwarded to you automatically.

Under the workaround, these waiting e-mails would be stored somewhere else -- on the servers that sit behind the firewall of a company or carrier network. A large part of the infringement of the NTP patents is based on the e-mails being stored at the NOC, analysts say. "Conceptually, I think this does get around the patents," says Ken Dulaney, an analyst for researcher Gartner Group, who's following the case and has been briefed by RIM on the workaround. RIM says its legal counsel maintains the workaround doesn't infringe on NTP patents.

The FAQ’s author still sees a settlement between RIM and NTP.

Couldn't RIM just settle and avoid all this hassle?
Many analysts still expect this. A $450 million preliminary settlement agreed upon last March fell apart in June. Some analysts now expect the settlement to be between $650 million and $1 billion Some analysts, including Andrew Neff at Bear Stearns, think the workaround and the PTO review give RIM more leverage to reach a more advantageous settlement.

If the workaround is technically successful and the Judge allows it, wouldn’t this eliminate any need for a settlement?

Thursday, February 09, 2006

Workaround Details Released

RIM has unveiled their patent workaround. RIM claims that while it will require new software to be installed on BlackBerry devices and companies’ BlackBerry Enterprise Server systems, the BlackBerry Multi-Mode Edition™ will make any changes visible to users, service providers, system administrators or developers.

RIM states that they still hope the workaround will not be needed but it can be remotely activated if required.

In addition to getting a legal opinion from a patent law and workaround expert that its designs do not infringe on any of the NTP patent claims remaining in the lawsuit, RIM also filed a patent for its workaround.

Monday, February 06, 2006

A Call To End Software Patents

Writing in Slate.com Columbia Law School professor Tim Wu characterizes NTP’s patents as "falling through the cracks" at the U.S. Patent and Trademark office. Wu states:

By all accounts, most examiners do their best to try to make sure the legal standards are complied with. Yet, given the workload and other pressures, there is also no question that inventions like the space vehicle or methods of exercising kitty-cats are falling through the cracks.

It was in this environment that David Stout, co-founder of New Technologies Products, a former examiner and experienced patent lawyer, filed for a series of patents premised on wireless e-mail in the early 1990s. Arguably his patents should never have been granted; the idea of "wireless e-mail" is just too obvious to merit patent. The PTO itself now seems to think it made a mistake, as it is currently in the course of invalidating many of NTP's patents in re-examination proceedings (although probably will be too late to help RIM).

In the bigger picture, Wu looks at whether software patents should exist at all. Arguing most companies and programmers cannot tell if they are infringing and therefore must always assume they are, and that most companies get no benefits from software patents, Wu suggests that the application of patents to software should end.

Friday, February 03, 2006

Injunction Delay Until September?

The National Post quotes an expert as saying that the US Justice Departments concerns about the impact of a BlackBerry service injunction on its users will likely cause the District Court Judge hearing the case to postpone any immediate injuction. The article does not give a reason why but suggests September as the earliest date.

The article notes that will the U.S. Patent and Trademark Office has ruled against NTP’s patents, the rulings are not final and the District Court does not need to consider them or wait for the rulings to be final.

Not mentioned is what would happen if the Judge makes a ruling and then the patents are overturned for good.

Wednesday, February 01, 2006

Justice Department Opposes Shutdown

Associated Press reports that the US Justice Department has again expressed concern that any BlackBerry email service shutdown could negatively affect government users.

If the US Department of Homeland Security decides that the BlackBerry email service is needed for Homeland Defend and they were concerned that the shutdown would affect their users, could they overrule any injunction by the judge?

Last NTP Patent Rejected

Citing the existence of prior-art, the U.S. Patent and Trademark Office has issued a "non-final" rejection of the last of NTP Inc.’s five patents that it claims Research In Motion Ltd is infringing. NTP announced that it would appeal any rulings against it so it is unclear how this will affect the February 24th court hearing on a potential injunction.

The Globe and Mail notes NTP’s options:

NTP has 30 days to respond, after which a final ruling is issued. Either side can appeal the final decision to a patent appeals board, the U.S. Court of Appeals for the Federal Circuit and eventually the Supreme Court.

However RIM’s stock rose $6.75 to $84, up 8.7 per cent on the news.

RIM's has issued a Press Release on this ruling.