NTP Inc, the US patent house that battled Research in Motion Ltd for alleged patent infringement, has filed suit against Palm Inc. The news sent Palm shares down more than 7.5% to close at $14.24 on the Nasdaq yesterday.
NTP claims Palm infringed on its wireless email patents, most likely with its Treo smart phones.
Richmond, Virginia-based NTP was set up in 1992 to defend wireless email patents developed the late Thomas Campana. Good Technology, Nokia and Visto are among its licensees.
The intellectual property outfit did not return repeated calls for comment. But it said, in a statement, that it seeks an injunction on the sale of Palm products that allegedly infringe its patents, as well as unspecified monetary damages.
NTP said that Palm’s products, services, systems and processes infringe NTP’s patents, but gave no further details. A Palm spokesperson said the company was preparing a statement in response, but it was not issued by press time.
The company sought similar retribution from RIM in recent years. NPT said RIM’s BlackBerry device and email service stepped on its intellectual property. After a long and protracted legal tussle RIM settled with NTP for $612.5m earlier this year.
We have attempted on numerous occasions — to resolve this issue with Palm without resorting to litigation that is both time consuming and costly, said NTP cofounder Donald Stout, in a statement. Despite our efforts, Palm has chosen to continue to unlawfully infringe on our patents.
Stout also said NTP would prefer to resolve the issue with Palm in a negotiated license agreement that is fair and reasonable to both parties, but filed suit as a last resort to protect its IP.
In its protracted legal battle with NTP, RIM sought to have the examined the validity of some of NTP’s and with some success. The US Patent and Trademark Office earlier this year reexamined some of NTP’s patents and two of them were effectively invalidated.
At the time, NTP said it would appeal the patent office’s decision, but then RIM struck a settlement deal with it. Whether or not PTO’s potential review of the patents would affect the Palm case was not immediately clear.
As part of the RIM settlement agreement, even if the PTO eventually rules invalid the contested NTP patents, RIM will not be refunded its $612.5m settlement money.
To the end, RIM bitterly fought against NTP. RIM’s co-CEO James Balsillie said the company settled with NTP that once it became clear that the court handling the case would not delay its proceedings to wait for the PTO’s final decision, which could have taken months or years.
Ultimately, RIM settled with NTP because of the disruption to the industry and its customers, according to Balsille.
We fundamentally did this for the industry, he said back in March when the settlement was first announced. There’s no question we took one for the team here.