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Nortel, Ciena Near IP Trial

The U.S. International Trade Commission (ITC) has terminated its investigation of three Nortel Networks Corporation subsidiaries, the company said today.

At the behest of Ciena Corporation, the ITC began examining whether networking giant Nortel , Flextronics Telecom Systems and Flextronics International had infringed on some of Ciena's patents.

Nortel and Ciena, a maker of optical networking equipment, have been tangled in patent wrangles since 2000. The problems began for Ciena when it bought ONI Systems in February 2002.

ONI, a fiber-optics manufacturer, had been locked in litigation with Nortel since March 2000. In January 2003, the two companies settled that suit, with Ciena offering a one-time payment of $25 million and the licensing of some Nortel patents.

In return, Nortel also agreed to dismiss the patent infringement suit it had brought against Ciena in November 2002 without prejudice; the two companies agreed not to sue each other for patent infringement for two years.

Then, in January 2005, Ciena sued Nortel for infringing its optical transport patents. Ciena said products in Nortel's Optera family infringe on six Ciena patents.

In March, Nortel countersued, saying Ciena infringes 13 of its U.S. patents.

In the course of that suit, Nortel won a preliminary injunction ordering Ciena to lay off the ITC action.

The two companies will square off in U.S. District Court in Marshall, Texas, in June 2006.