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NTP, Inc.

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NTP, Inc. is a Virginia-based patent holding company, founded in 1992 by the late inventor Thomas J. Campana Jr. and Donald E. Stout. The company's primary asset is a portfolio of 50 US patents[1] and additional pending US and international patent applications. These patents and patent applications disclose inventions in the fields of wireless email and RF Antenna design. The named inventors include Andrew Andros and Thomas Campana. About one half of the US patents were originally assigned to Telefind Corporation, a Florida-based company (now out of business) partly owned by Campana.[2]

NTP also owns an equity stake in mobile email start up company Visto.

Patent Licenses

As of December 2005, NTP had licensed its mobile email patents to Visto, Nokia, and Good Technology, [3].

As of February 2006, NTP had licensed its mobile email patents to RIM and all of RIM's partners. This license agreement was part of an overall settlement of a patent infringement lawsuit brought by NTP against RIM (see below).[4]

Patent Litigation

In 2000, NTP sent notice of their wireless email patents to a number of companies and offered to license said patents to them. None of the companies took a license. NTP therefore, selected one of the companies, Research in Motion, and brought a patent infrigement lawsuit against them in the United States District Court for the Eastern District of Virginia. This court is particularly efficient at trying patent cases.

During the trial, RIM attempted to show that a functional wireless email system was already in the public domain at the time the NTP inventions had been made. This would have invalidated the NTP patents. The prior system was called System for Automated Messages (SAM). RIM demonstrated SAM in court and it appeared to work. The NTP attorneys discovered, however, that RIM was not using vintage SAM software, but a more modern version that came after NTP's inventions were made. The judge, therefore, told the jury that the demonstration was not valid and instructed the jury to disregard it.

When the jury returned a verdict, they found that the NTP patents were valid, that RIM had infringed them, that the infringment had been "willful", and that the infrigement had cost NTP $23 million dollars in damages (the greater of a reasonable royalty or lost profits). The judge, James Spencer increased the damages to $53 million as a punative measure because the infringement had been willful. He also instructed RIM to pay NTP's legal fees of $4.5 million and issued an injunction ordering RIM to cease and desist infringing the patents. The net effect of this would have been to shut the BlackBerry systems down in the US.[5]

RIM appealed all of the findings of the court. The injunction and other remedies were stayed pending the outcome of the appeals.

In March of 2005 during the appeals process, RIM and NTP attempted to negotiate a settlement of their dispute. One of the terms of the settlement was to be for $450 million. Negotiations broke down, however, due to other issues. On June 10, 2005 the matter returned to the courts.

During this time, RIM found previously unconsidered prior art that "raised a substantial new question of patentability" in the NTP patents. They therefore filed twelve "requests for a reexamination" in the USPTO(US Patent and Trademark Office)over the period of Dec 2002 to May 2005. Reexamination at the patent office is a separate process from the appeals process in the US Federal Courts. A team of senior patent examiners at the USPTO was assigned to the cases and the cases were granted "special" status. Both RIM and NTP have filed thousands of pages of documentation and expert opinions to support their respective postions. Some of the cases have been examined and some of the patents have been rejected. In two of the cases, the rejections have been made "final".

NTP has appealed the final rejections to the USPTO's Board of Patent Appeals and Interferences (BPAI). The BPAI has not yet reached a decision on any of the cases. Even if the Board of Appeals affirms the rejections, however, NTP can further appeal to the US Court of Appeals for the Federal Circuit. If NTP still does not prevail, they can further appeal to the US Supreme Court.

In early November, 2005 the United States Department of Justice filed a brief, requesting that RIM's service continue because of the large number of BlackBerry users in the Federal Government [1].

In January of 2006, the US Supreme Court refused to hear RIM's appeal of the conviction for patent infringement, and the matter was returned to a lower court. The previously granted injunction preventing all RIM sales in the US and use of the BlackBerry device might have been enforced by the presiding district court judge had the two parties not been able to reach a settlement [2].

On 9 February 2006, the United States Department of Defense filed a brief stating that an injunction shutting down the Blackberry service while excluding government users was unworkable. The DOD also stated that the Blackberry was crucial for national security given the large number of government users.

On 9 February 2006, RIM announced that it had developed software workarounds that would not infringe the NTP patents. They further announced that would implement said workarounds if the injunction was enforced

On 3 March 2006, after a stern warning from judge Spencer, RIM and NTP announced that they had settled their dispute. Under the terms of the settlement, RIM has agreed to pay NTP $612.5 million (USD) in a “full and final settlement of all claims.” In a statement, RIM said that “all terms of the agreement have been finalized and the litigation against RIM has been dismissed by a court order this afternoon. The agreement eliminates the need for any further court proceedings or decisions relating to damages or injunctive relief.” The settlement is believed low by some analysts, because of the absence of any future royalties on the technology in question[3].

The reexaminations of NTP's patents, however, will still continue, and the patents may yet be found to be invalid. Members of the public can follow the process of the reexaminations at the USTPO's internet portal [4]

Patents in question

(This may not be a comprehensive list)

See also

Patent_troll

References

  1. ^ NTP US patents, http://patft1.uspto.gov/netacgi/nph-Parser?Sect1=PTO2&Sect2=HITOFF&u=%2Fnetahtml%2FPTO%2Fsearch-adv.htm&r=0&p=1&f=S&l=50&Query=an%2Fntp&d=PTXT
  2. ^ Telefind US patents, http://patft1.uspto.gov/netacgi/nph-Parser?Sect1=PTO2&Sect2=HITOFF&u=%2Fnetahtml%2FPTO%2Fsearch-adv.htm&r=0&p=1&f=S&l=50&Query=an%2Ftelefind%0D%0A&d=PTXT
  3. ^ NTP licensees, http://www.businessweek.com/technology/content/dec2005/tc20051215_806425.htm
  4. ^ NTP RIM Settlement, http://www.rim.com/news/press/2006/pr-03_03_2006-01.shtml
  5. ^ Barrie McKenna, Paul Waldie and Simon Avery, Globe and Mail, February 21, 2006, "Patently Absurd: The inside story of RIM's wireless war, http://www.theglobeandmail.com/servlet/story/RTGAM.20060221.wpatentlyabsured-rim21/BNStory/RIM2006/home?pageRequested=all&print=true
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