Xerox Wins Appeal of Patent-Infringement Suit Vs. Palm

A patent infringement lawsuit filed by Xerox Corp. more than four years ago against Palm Inc. over its use of
handwriting recognition technology has seen some life after it was nearly killed by a dismissal.

The U.S. Court of Appeals for the Federal Circuit Monday ruled in favor of the Stamford, Conn.-based printing specialist, allowing
litigation to proceed in a lawsuit filed against Santa Clara, Calif.’s handheld device maker.

The reversal underscores the problems of interpreting complex technological patents; as more and more revolutionary technologies
surface, those that craft the patents must make be painstakingly careful to be as specific as possible about what the patent is
about, and how exactly the document protects its inventor’s interests. Moreover, it is more imperative than ever that judges are
clear about what falls under a patent’s guidelines.

Xerox commenced legal action against Palm in April 1997 because it claimed U.S. Robotics, which was purchased by Palm, was using a
handwriting recognition technology closely resembling Unistrokes, a patented architecture forged in Xerox’s research center in Palo
Alto, Calif., in Palm handheld devices. The technology, as it appeared on Palm’s personal digital assistants, was called Graffiti.

Xerox case appeared to be quashed in June 2000 when a federal judge in Rochester, N.Y. dismissed the suit; the judge said the
software as it appeared on Palm’s PDAs did not use the same recognition patterns as Xerox’s software did.

Monday marked the reversal of the decision, as the court said the judge misinterpreted how and where the symbols must be written to
be recognized by the computer.

“Palm and 3Com now have lost two rounds in their effort to avoid the patent,” said Christina Clayton, a lawyer representing Xerox.
In 1997, the U.S. Patent and Trademark Office certified all of the Xerox Unistroke patent claims as valid. Now the Court of Appeals
has reversed a finding of no infringement and defined the use of Graffiti in the Palm devices clearly within the scope of the Xerox
claims.”

The case has been moved to U.S. District Court, Western District of New York, in Rochester.

However, even though the case will be returned to district court, Palm emphasized that the decision in no way proclaims Xerox as the victor.

“Palm continues to believe that the Graffiti software does not infringe the patent and that Palm has other defenses supporting its stance. Palm intends to continue to vigorously
defend itself,” said Carl Yankowski, Palm’s chief executive officer.