RIM’s hot-selling BlackBerry devices have a future in United States markets now that the wireless communication maker is squeezing out $450 million to settle a nagging patent lawsuit against it once and for all.
Research In Motion (RIM)
said it has reached an agreement with NTP Inc., a closely held Virginia patent holding company, to resolve all current and future patent infringement issues between the two companies. RIM was facing an injunction that would have prohibited it from selling its BlackBerry products in the United States.
Now that a deal has been struck, RIM can sublicense certain NTP
patents that, “interface, interact or combine with RIM’s products,
services or infrastructure.” The contract also covers all of RIM’s past and future products, services and technologies as well as all of the Waterloo, Ontario-based mobile device maker’s customers and providers, including wireless carriers, distributors, suppliers and ISV partners.
“The resolution permits RIM and its partners to sell its products,
services and infrastructure completely free and clear of any claim by
NTP, including any claims that NTP may have against wireless carriers, ISV partners or against third party products that use RIM’s BlackBerry Connect/BlackBerry Built-In technology,” RIM said in a statement.
The company recently announced it had passed the 2 million mark in
subscribers amid record sales and revenue.
The $450 million in settlement money includes $152 million in
judgment money less $15 million in other litigation related fees. RIM
said a large chunk of the $313 million, which is the balance of the
settlement amount, would be expensed in its next quarterly financial
The two companies said they would disclose more of the definitive
licensing and settlement agreement in upcoming weeks. RIM is expected to update its strategy further on April 5, when the company posts its fourth quarter financial results.
NTP originally sued RIM in 2001, claiming its wireless e-mail service infringed on eight NTP patents relating to an “electronic mail system with RF communications to mobile processors.”
RIM lost a 2002 jury trial, and last August, a U.S. court found that RIM had infringed on five NTP patents and ordered it to pay $53 million in damages. The ruling barred RIM from selling BlackBerry devices in the United States until NTP’s patents expire in May 20, 2012, but that injunction was stayed.
RIM appealed that decision and in the June Virginia ruling, a jury found direct, induced and contributory infringement by RIM on all of NTP’s claims. Based on a royalty rate of 5.7 percent, the jury awarded NTP approximately $23 million in damages.
Then in December 2004, a federal appeals court ruled RIM infringed on the NTP patents, but still sent the case back to a Virginia district court for further review of damages.
The company recently announced it had passed the 2 million mark in subscribers amid record sales and revenue. That number may jump further as more third party products come to the BlackBerry. RIM announced a deal on Monday that allows it to pre-install software for AOL Instant Messenger, AOL’s ICQ service and Yahoo Instant Messenger instead of
having customers download it themselves. RIM also said it was working to expand distribution of BlackBerry Connect on Windows Mobile-based devices from Taiwan’s HTC to global carriers.