Shares in the maker of the popular wireless handheld computers
tumbled on Thursday after
RIM
announced that it had
taken court action to force
NTP
to carry out the terms
of the agreement reached between the two firms this year.
The dispute dates back to November 2001, when
NTP
alleged that certain
RIM
products were infringing on
patents covering a method of using radio frequency wireless
communications in e-mail 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
RIM
from selling in the
US
the BlackBerry and any other products, software or
services using the wireless technology in dispute. The judge stayed
the injunction pending an appeal.
The Court of Appeals issued its ruling in December last year,
finding that
RIM
’s Blackberry did indeed infringe on
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.
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 the “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 licence and
settlement agreement.
However, according to
RIM
,
NTP
is now
refusing to honour its obligations to finalise the definitive
agreement.
RIM
has therefore filed suit, asking the
Court to enforce the Term Sheet.
Reuters reports that
NTP
has filed a
counter-motion, arguing that it has become clear that the Term
Sheet does not represent a meeting of minds. The two firms appear
to be in dispute about the scope of the agreement as set out in the
Term Sheet.
According to the New York Times,
NTP
does not
believe that the agreement relates to technology developed by
RIM
since the first lawsuit filing, and is seeking
additional payments in connection with this.
According to a report on GlobeandMail.com, the deal-breaker is
the question of licensing or sublicensing the patents to third
parties.
Earlier this year the
US
Patent and Trademark
Office ruled that the validity of two of the five
NTP
patents invoked by the case was questionable. It has yet to issue a
ruling on the remaining three.
