RIM has recently won court rulings in the UK and Germany that
make a European shutdown unlikely. But the Canadian company is
still locked in battle with US patent holder NTP.
"RIM remains pragmatic and reasonable in its willingness to
enter into a settlement that would generously compensate NTP while
protecting RIM’s business and partners," said Jim Balsillie,
Chairman and Co-CEO at RIM yesteday. "NTP’s public offer of a
so-called ‘reasonable’ license, however, is simply untenable. It
comprises illusory protection for RIM and its partners and requires
a lump-sum payment for the theoretical life of the patents even
though the US Patent Office is expected to nullify them."
Balsillie added: "RIM’s workaround provides a contingency for
our customers and partners and a counterbalance to NTP’s threats.
This will hopefully lead to more reasonable negotiations since NTP
risks losing all future royalties if the workaround is
implemented."
RIM points out that workarounds are a legitimate strategy that
have been respected by the courts as a means to avoid infringement.
In the years leading up to its public launch in 1999, it says the
BlackBerry was invented wholly independently of NTP’s patents and
comprises a wide spectrum of designs and inventions that are
outside the scope of NTP’s patents.
There are only nine claims relating to three NTP patents
remaining in dispute in their litigation and those claims are only
directed to specific implementations of certain aspects of the
BlackBerry products and services. As a result, RIM says it has been
able to modify its underlying BlackBerry message delivery system to
work around the NTP patent claims.
Although the development of this modification required
substantial R&D effort from RIM and would require software
updates in the event of an injunction, RIM says it has ensured that
the "industry leading functionality, performance and user
experience" remains intact.
NTP has previously told the court that it will argue that even
RIM's workaround will infringe is patents. But RIM says it has
received a legal opinion suggesting that RIM’s software workaround
designs do not infringe any of the NTP patent claims remaining in
the litigation.
RIM has incorporated the workaround designs into a software
update called BlackBerry Multi-Mode Edition. RIM has also filed new
patent applications with the Patent Office to cover its workaround
designs.
BlackBerry Multi-Mode Edition is so named because the software
is capable of operating in different modes that can be remotely
activated by RIM through its Network Operations Center (NOC). In
the absence of an injunction, the software and the underlying
message delivery system can continue to run in “Standard Mode”
(identical to the manner in which the current BlackBerry software
and system operate) and the workaround will remain dormant. In the
event of an injunction, RIM is able to remotely activate “US Mode”
via its NOC and the workaround designs would automatically engage
for each handset containing the Multi-Mode Edition software
update.
RIM hopes that an injunction, if granted, would not apply to
customers that purchased a BlackBerry handset prior to the
effective date of any such injunction. RIM believes there are legal
grounds for (at least) exempting pre-existing customers from any
injunction and RIM has raised these arguments in its court
submissions. In the event of an injunction without such an
exemption, however, the BlackBerry Multi-Mode Edition software
update would allow continuing service for pre-existing
customers.
In the event of an injunction barring new sales of products
utilising RIM’s current system designs, RIM will have already
pre-loaded the new BlackBerry Multi-Mode Edition software on to
BlackBerry handsets and incorporated it into BlackBerry Enterprise
Server software prior to shipping.
RIM will soon begin to ship the new software latent on new
handsets in addition to making the software update generally
available at the website listed below for corporate IT departments
and others to download and implement in accordance with their IT
procedures. For avoidance of doubt, UK users do not need the
workaround.
NTP has proposed a 30-day transition period in the event of an
injunction; but RIM has argued that the transition period should be
longer.
Meanwhile, the US Patent Office has already rejected each of
NTP’s patents on two occasions. But it has not reached the stage of
cancelling NTP's patent claims. The court action continues
regardless: it will not wait to see what the US Patent Office
finally decides, although cancellation of NTP's patents will surely
result in the lifting of any injunction.
The impact of patent cancellation on the damages and royalty
payments is unclear. A spokesman for NTP told OUT-LAW that he could
not comment on this because it "depends on many contingencies."
