The dispute dates back to November 2001, when holding company NTP alleged that certain Research In Motion products were infringing on patents covering a method of using radio frequency wireless communications in email systems.
In November 2002, a jury found in favour of NTP and the firm was awarded damages of $53.7 million together with an injunction prohibiting Canada’s RIM from selling in the US the BlackBerry and any other products, software or services using the wireless technology in dispute. The judge stayed that injunction pending an appeal.
The Court of Appeals issued its ruling in December last year, confirming that RIM’s Blackberry did infringe some of NTP ’s patents, but that one of the lower court’s key definitions, relating to the term “originating processor", was too wide. The Court of Appeals therefore returned the case to the District Court for further arguments over five claims that may have been affected by the flawed definition.
With both firms under pressure from the ruling, they settled the case in March this year. RIM promised to pay $450 million to NTP in return for an unfettered right to continue its BlackBerry-related wireless business without further interference from NTP or its patents.
The agreement, known as a “Term Sheet,” was only half a page long, and stated that the two firms would continue to negotiate in good faith to finalise the terms of a definitive license and settlement agreement.
However, in June, RIM alleged that NTP was refusing to honour its obligations to finalise the definitive agreement and asked the District Court to enforce the Term Sheet.
In the meantime, RIM appealed the District Court ruling, and it is in respect of this appeal that a decision was published yesterday.
Yesterday’s ruling by the US Court of Appeals for the Federal Circuit in Washington largely upholds the previous ruling, but finds that RIM had not infringed on NTP’s patent claims relating to a business method.
The court lifted the earlier injunction and damages award, and returned the case to the District Court for adjudication on the effect of the flawed definition of “originating processor” on the remaining claims.
According to the ruling:
“If prejudice is shown with respect to the claims containing the ‘originating processor’ limitation, and because the jury verdict did not specify the amount of infringing sales attributed to each individual patent claim, or the specific devices and services determined by the jury to infringe each separately asserted claim, the district court will have to determine the effect of any alteration of the jury verdict on the district court’s damage award and on the scope of the district court’s injunction.”
Speaking to Reuters, NTP lawyer James Wallace said that NTP remained positive. "All we need is just one claim to shut them down," he said.
