BlackBerry Could be Killed by Patent Troll
The seemingly ubiquitous BlackBerry devices may soon be out of commission because of a lawsuit for a dead patent troll.
Blackberry held hostage (FORTUNE)
What would Osama bin Laden give to be able to knock out every BlackBerry in America and achieve an instant, sweeping disruption of commerce? The good news is he can’t do it. The weird and disconcerting news is that a company called NTP can and, unless it’s paid off, probably will sometime before Christmas.
NTP has this remarkable power because it is nearing victory in its four-year-old patent litigation with Research in Motion, the maker of the BlackBerry. RIM faces the real likelihood of a court-ordered BlackBerry blackout (government devices would be exempted) unless it agrees to pay essentially whatever sum NTP names, which some analysts think will approach ten figures.
However the endgame plays out, it vividly illustrates a recurring lightning-rod issue in patent debates — one that pits the information technology industry, which favors reform, against many others, such as the pharmaceutical industry, which don’t. Should plaintiffs like NTP — which does not market a competing product, never has, and never will — be entitled to an automatic injunction shutting down a productive infringer such as RIM?
NTP was founded in 1991 by the late inventor Thomas Campana and his patent attorney, Donald Stout, of Arlington, Va. It has no employees and makes no products. Its main assets, Campana’s patents, have spent most of the past decade in Stout’s file drawer. But in 2002 a federal jury found that RIM had infringed five NTP patents that relate to integrating e-mail systems with wireless networks. An appellate court largely agreed in August 2005, and in late October the U.S. Supreme Court declined to issue a stay while it ponders whether to hear the case.
No one has claimed that RIM ever copied NTP’s patents. But under the law — and this isn’t even the controversial part — that doesn’t matter. As long as NTP staked its claim first, if RIM later independently wandered into the same intellectual territory and managed, unlike NTP, to invent and produce a wildly popular product, it is an infringer.
The Business Software Alliance, led by companies like Apple, Intel and IBM, has argued before Congress that there is often no “irreparable harm” when the plaintiff isn’t making any product, since a reasonable royalty will give that plaintiff everything to which it is entitled.
“The patent troll” — the derogatory term for such plaintiffs — “has zero interest in killing the goose laying golden eggs,” says Matt Powers, a patent litigator at Weil Gotshal & Manges who represents Intel and Microsoft. Though the troll wants to negotiate a license, he adds, his potential power to shut down the defendant’s product line gives him an unfair advantage. The situation is exacerbated, he notes, when the product — a Pentium processor, for example — contains thousands of inventions.
Clearly, coming up with vague ideas and then not doing anything about them is not what intellectual property law is trying to protect.
Interestingly, the Federal government has stepped in to protect its own access to the popular devices.
No BlackBerry, No Life (Business Week)
Some people make jokes about Washington wonks being attached to their BlackBerry e-mail devices, but the government takes the service very seriously. The Justice Department has filed a legal brief in a patent dispute, asking a federal court to delay any immediate shutdown of the popular wireless e-mail system to ensure that state and federal workers can continue to use their devices.
The Justice Department, filing on behalf of various government agencies, requested a stay of 90 days to put together an electronic database of government users whose service should not be cut off in the event Research In Motion loses its final legal battles and does not reach a settlement. In addition, the statement of interest filed by Justice said the government is concerned “there may be a substantial public interest that may be impaired” by shutting down the service. There are more than 3 million BlackBerry users in the United States, nearly 10 percent of whom are state and federal government employees who use the devices to keep in contact when out of the office.
This particular dispute may be moot soon, as RIM claims it has developed a workaround that would use different software independent of NTP’s patents. Still, a most disturbing application of patent law.