NTP Inc. alleges its business has suffered “substantial harm” because of Research In Motion Ltd.'s refusal to settle a patent infringement case it lost against the company more than three years ago.
The small, Virginia-based patent holding firm said in court documents that other companies have refused to negotiate royalty licences from it because RIM, “the 900-pound gorilla in the wireless e-mail industry,” continues to willfully infringe on NTP technology.
NTP accused RIM Tuesday of “free riding” on its intellectual property, and in a court filing it restated its call for an injunction on RIM's BlackBerry wireless e-mail service in the United States.
RIM late Tuesday filed its own arguments with the court against an injunction, but did not respond to requests for copies of its submissions, one of which was sealed by the court.
Last year, Nokia Corp., the world's largest manufacturer of handsets, and two small wireless e-mail companies became the first and only businesses to license NTP's technology. The firm was founded in 1991 to protect the patents of inventor and engineering consultant Thomas Campana Jr., who died in 2004.
NTP and RIM will slide into “a never-ending series of scorched-earth litigations” unless the court orders the injunction, NTP said in its filing with the U.S. District Court for the Eastern District of Virginia.
“Litigation against RIM is demonstrably costly, time consuming and emotionally draining for NTP's principals,” it said.
In a judgment proposal submitted with the filings Tuesday, NTP said it should be awarded monetary damages of $125.9-million (U.S.) as of last Nov. 26, plus almost $7-million of interest. The firm continues to offer to settle the fight for a one-time payment based on a royalty rate of 5.7 per cent.
Last March, RIM announced that it had reached a settlement and would pay NTP $450-million, but that deal fell apart by June.
The legal battle is more than four years old now. In November, 2002, a U.S. jury found RIM had willfully infringed on five of NTP's patents. The judge set the damages at $53.7-million and ordered RIM to pay a royalty of 8.55 per cent on BlackBerry sales in the United States. He also issued an injunction, which was stayed during appeal.
The U.S. Court of Appeals for the Federal Circuit in Washington agreed RIM had infringed on the patents, but said the lower court judge had incorrectly defined one of the technical terms.
NTP argued in its latest filing that the misstep should have no bearing on the monetary award or injunction previously issued.
Judge James Spencer of U.S. District Court for the Eastern District of Virginia ordered the two parties to submit their final arguments Tuesday. They have until Feb. 1 to file responses to each other's motions, meaning the judge could make his ruling as early as next month.
Meanwhile, the U.S. Patent and Trademark Office is in the process of re-examining the disputed claims. In a set of preliminary rulings it has rejected four of NTP's patents.
RIM says it has designed and tested a replacement version of its BlackBerry wireless system that would let it work around NTP's patent claims, but so far the company has refused to provide any details. NTP has said it will challenge such a work-around as further infringement of its patents.
RIM shares closed down $1.41 (Canadian) or 1.7 per cent to $78.83 Tuesday on the Toronto Stock Exchange. The stock fell 2.3 per cent to $67.73 (U.S.) on the Nasdaq Stock Market.
