RIM goes on offensive in patent dispute with NTP

Despite expectations by industry and legal analysts that Research in Motion Ltd. (RIM) would settle its ongoing patent dispute with NTP Inc., the BlackBerry maker came out swinging Monday, bolstered by recent decisions by the U.S. Patent and Trademark Office (PTO) that call NTP's claims into question.

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RIM lashed out Monday with an op-ed piece in The Wall Street Journal accusing NTP of prolonging the PTO's reexamination of the patents in hopes of getting a U.S. injunction on the sale of BlackBerry devices and services before its patents are struck down. RIM is willing to settle the case, and would agree to pay a fair royalty rate, but only as long as the patents in the case remain valid, wrote Jim Balsillie [cq], chairman and co-chief executive officer of RIM, in the essay published Monday.

The PTO has already issued "nonfinal office actions" that invalidate NTP's claims at issue in the dispute, and its recent decision to expedite its process of issuing final actions could assuage Judge James Spencer's [cq] concerns that the PTO is holding up the legal process, Balsillie said in a phone interview with IDG News Service Monday.

NTP's patents cover a system for distributing wireless e-mail to mobile devices. A jury and appeals court have found that RIM's BlackBerry devices and software infringe on those patents, and the final hearings in the case are looming before a Virginia judge who is expected to reimpose an injunction that would stop BlackBerry users from receiving their e-mail in the U.S. That injunction was stayed during the appeals process and lifted by an appeals court that decided a key claim was misinterpreted. However, that same appeals court upheld the fundamental finding of infringement. Observers now expect the lower court to reinstate the injunction.

Last week, the PTO denied several NTP requests for more time to respond to the preliminary findings and created a special team to handle claims related to this case, which has generated "outstanding public interest," it said in documents available on its Web site (http://www.uspto.gov). On Nov. 30, Judge Spencer of the U.S. District Court for the Eastern District of Virginia denied RIM's request to stay the trial pending the PTO reexamination process, saying it could take years before a resolution was reached through that process.

The patents were initially rejected because other inventions similar to the NTP patents were on record prior to NTP's filing, the PTO said in the preliminary actions it issued in June. Since then, the PTO has also learned of additional prior art developed by Telenor ASA, the Norwegian telecommunications company, that it cited in the most recent claim rejection announced this month.

NTP has the right to appeal any final action to the PTO's board of appeals, and beyond the PTO to the U.S. Court of Appeals for the Federal Circuit, said James Wallace [cq], an attorney with Wiley Rein & Fieldling LLC, in Washington, D.C., representing NTP. That appeals court already has ruled that the BlackBerry infringes on the patents using a narrower claim description, he said.

"The court of appeals said the claim covers a square city block," Wallace said in comparing the PTO's viewpoint and that of the court of appeals. "But the PTO said it covered two blocks." The entire appeals process could still take years, he said.

However, RIM believes that if the PTO quickly issues final actions invalidating the patents, it would create enough doubt around the patents to persuade the lower court to halt the proceedings until the validity of the patents is settled, Balsillie told IDG News Service.