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RFID Companies Bury Patent Hatchet

Two giants in the world of radio frequency identification (RFID) and bar code reading settled mutual patent litigation.

Symbol Technologies and Intermec Technologies announced an agreement that ends their mutual lawsuits over RFID patents. They placed all other legal actions on hold while they attempt to negotiate remaining disputes.

The announcement was made at the close of Intermec's Rapid Start Licensing program, which gave companies a three-month window in which to license Intermec intellectual property that's essential to the newest RFID standard.

Both Symbol and Intermec have contributed technology for the UHF Generation 2 (Gen 2) standard for RFID communications that was ratified in December 2004.

As part of the settlement, Symbol joined Intermec's Rapid Start RFID intellectual property licensing program. Through Rapid Start, Symbol will be able to license some Intermec RFID patent portfolios, including those for RFID tags and fixed and portable readers. Symbol will exercise the cross-licensing provisions of the Rapid Start program to give Intermec access to its own RFID IP.

"Rapid Start was initiated in June. We were already in legal action with Symbol at that time," said Steve Winter, Intermec COO. "I think the fact we did announce a program and make it clear it would be our only licensing program at these favorable rates was a catalyst for them to come forward."

Intermec said 19 companies had joined Rapid Start.

In looking at the roster of licensees, ABI Research analyst Erik Michielsen said, "You do have the value chain represented. Intermec was able to bring in folks across that chain."

Intermec, a division of Unova , makes RFID tags, mobile computing systems, bar code printers and label media. Symbol provides data capture products, radio frequency identification technology, mobile computing platforms, wireless infrastructure, mobility software and services. Symbol did not respond to a request for comment.

The companies engaged in rapid-fire rounds of lawsuits.

The flurry of suits began in June 2004, when Intermec filed an RFID-related patent infringement suit against Matrics Corp., now owned by Symbol Technologies.

On March 11 2005, Symbol countersued Intermec, saying the latter infringed on its Wi-Fi patents used for barcode scanning.

Later that month, Intermec sued Symbol, charging it infringed on its patent for "a coherent, integrated wireless data capture system capable of distributing data over a network. Another patent involved portable, battery-powered data processing devices capable of running a multi-tasking operating system, yet another covered handheld portable data capture devices with graphical user interfaces (GUI), the ability to accept handwritten information and the ability to process that information."

In April 2005, Symbol filed countersuits alleging that Intermec used its wireless RFID technologies. Symbol said Intermec also borrowed from its patents covering laser, imaging and Micro Electro Mechanical Systems (MEMS) technology. It said that barcode scanning devices, such as mobile computing terminals and handheld scanners, are covered in the patents as well.

Symbol is no stranger to wireless patent lawsuits. It won a $22.75 million judgement from Proxim in September 2003 in a suit over wireless patents, two of which it also sued Intermec for infringing. The two companies cross-licensed some patents, while other IP was signed over completely to Symbol, and signed a mutual covenant not to sue over patent issues through at least September 2009.

Intermec's Winter said that the Rapid Start program was designed to address concerns about its intellectual property that was incorporated in the Gen2 standard. "It was a question that was open, and it was important that we demonstrated leadership. There was some uncertainty, so providing a very clear and certain program certainly helped resolve that," he said.

While not every company that applied was accepted as a licensee, he said, "We have licensed everyone we are going to under those terms. It's possible that others will be licensed but not under those favorable terms."

Michielsen said that there are three companies notably missing from Intermec's licensing roster: tag maker Alien Technologies; Impinj, a maker of Gen2 tags and readers; and Royal Phillips Electronics , the chipmaker that was in a coalition with Intermec that supported one of the competing candidates for RFID Gen2.

"This doesn't mean that the companies are refusing to work with Intermec," Michielsen said. "They just may have longer term or different aspirations with regard to licensing."

Although Gen2 was ratified by EPCglobal, an industry consortium, last year, it's yet to become an ISO standard, Michielsen said, so Intermec's licensing program came at the right time. "By acting on this in August and September," Michielsen said, "companies can work to get their customers products over the next couple months, so that their customers' customers can deliver products to end users toward the end of 2006."