Buffalo Injunction May Prevent Sales

The Commonwealth Scientific and Industrial Research Organization (CSIRO), Australia’s national science agency, says it owns a patent covering specific aspects of wireless LAN technology. And the courts agree. CSIRO won a summary judgment in November of last year against Buffalo Technology in a Texas court, and last week the same court granted CSIRO an injunction against Buffalo.

That means Buffalo’s product sales are supposed to halt in the United States immediately. (As of this morning, however, Buffalo AirStation products were easily found on BestBuy.com, Amazon.com and Buy.com.)

Buffalo spokespeople were not available to comment as this story was posted. The company is likely to appeal the decision.

According to the Canberra Times, there was some concern among CSIRO’s lawyers at U.S. law firm Townsend and Townsend that this might not happen, after a precedent was set by the U.S. Supreme Court in May 2006, denying a permanent injunction over a patent dispute involving eBay (eBay v. MercExchange). The ruling put a “new burden on research institutions to show they had suffered irreparable harm,” according to the article.

This ruling is the first injunction against a company brought by a non-competing company – CSIRO is a researcher, not a product vendor. Had CSIRO lost, the game would probably be over. For now, it can continue to go after other WLAN vendors, seeking injunctions or royalties as it sees fit, at least until it’s handed a loss.

A number of companies, including Netgear, Intel, Microsoft and Apple, all filed suits in San Francisco last year to invalidate the patent. CSIRO petitioned to have those suits brought to Texas, to the same (and, some would say, friendly) court, but there’s no word yet on that.

CSIRO estimates over 100 companies in the world infringe on its WLAN patent. The patent in question, US Patent 5,487,069, covers “a wireless LAN, a peer-to-peer wireless LAN, a wireless transceiver and a method of transmitting data, all of which are capable of operating at frequencies in excess of 10 GHz and in multipath transmission environments.” CSIRO brought its case against Buffalo as a test in 2005, after Buffalo decided not to come to the table for licensing discussions, according to CSIRO.

Bluetooth technology had similar patent woes, but the Seattle-based nonprofit Washington Research Foundation (WRF) dropped its suits with companies like Samsung and Nokia after it settled with CSR, the U.K.-based chipmaker who supplied the manufacturers named in its suit, for a reported $15 million license fee.

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