HP, EMC End Patent Dispute

UPDATED: HP will pay EMC $325
million under an agreement that settles patent infringement allegations
between the two data storage companies.

HP can satisfy its payment to EMC through the purchase for resale or
internal use of complementary EMC products, such as the VMware product line,
over the next five years.

EMC and HP also have signed a five-year patent cross-license agreement to
bolster their mutual information lifecycle management strategies for
managing data from cradle to grave, confirmed EMC spokesman Mark
Fredrickson.

The companies have yet to finalize the details of those future business
arrangements. Fredrickson said EMC hoped the deal was the beginning of a
new chapter in the relationship between the two competitors.

“We’ve always taken our patents very seriously,” Fredrickson said in an
interview. “We have technology in both hardware and software with very
important patents that underpin that technology, and we need to be vigilant
in defending them.”

The settlement effectively ends four years of contentious litigation with no
findings or admissions of liability, he said, noting that the resolution
covers three cases going back to 2001.

EMC originally filed a patent infringement suit against StorageApps, which
HP acquired
in 2001 for $350 million. When HP consummated that deal, it also bought into
the lawsuit, which went all the way to trial.

EMC won a permanent injunction against HP, precluding the Palo Alto, Calif.,
company from using StorageApps’ Continuous Access Storage Appliance,
Fredrickson said.

HP then sued EMC in September 2002, claiming the storage specialist had
infringed seven HP patents. EMC countersued later that day with infringement
claims of its own.

The seven patents in HP’s suit against EMC cover powering storage systems;
transferring data between different storage formats; connecting servers to
storage systems; presenting storage system details to servers; improving how
arrays of hard drives read and write data; and coping with disk failure.

HP allegedly infringed on EMC’s patents for software that mirrors data onto
different storage systems. The countersuit also covered technology for
storing data from mainframe computers and software that moves data from one
storage system to another.

In the last legal salvo, HP last fall filed another suit asserting the same
patents, attempting to apply them to newer EMC products.