RIM Loses Another Round In Blackberry Saga

by Glen Shapiro, LawAndTax-News.com, New York

02 December 2005

After the US Supreme Court refused an emergency application last month from Canadian Blackberry wireless e-mail provider RIM for a halt to proceedings brought by Virginia patent concern NTP, a Virginia District Court has now voided a deal between the two companies which RIM had hoped to enforce.

District Court Judge James R. Spencer's ruling in favor of NTP and against the $450 million March agreement increases pressure on RIM to re-open negotiations with NTP, from a position of weakness, although RIM says it has alternate technology to keep the widely used BlackBerry service running without infringing patents.

The court also denied a request by RIM to delay the court proceedings to allow the US Patent and Trademark Office to complete a re-examination of NTP's patents.

RIM has said it fears that NTP will file a new motion asking the District Court to reinstate a 2003 injunction prohibiting RIM from providing BlackBerry service and from using, selling, manufacturing or importing its handhelds and software in the United States. RIM maintains that an injunction is inappropriate given the facts of the case and substantial doubts raised subsequent to trial as to the validity of the patents in question. The injunction had been stayed pending RIM's appeal, which has now been lost, although RIM still hopes for a Supreme Court review of the case.

The patent fight has involved RIM's use of technology to send email wirelessly and automatically, and without a need to manually retrieve messages. The original jury found that RIM infringed NTP's patents, rejecting the company's defense that since BlackBerry emails are sent through a Canadian network US patents don't apply.

In fact no-one expects NTP to use its nuclear option as long as RIM is prepared to talk, given that virtually all the lawyers involved in the case use Blackberry themselves, and a prominent Congressman said recently that the work of Congress would be severely impeded without Blackberry technology.

RIM has nearly four milllion subscribers. Nonetheless, RIM shares fell $3.79, or 5.8%, to $61.13 on Wednesday after the news broke. The company will probably have to ante-up more than the previously agreed $450m in order to placate NTP.

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