June 29, 2005 3:29 PM PDT

Patent spat costs RIM millions

BlackBerry maker Research In Motion has spent $6.5 million in the last three months on efforts to settle its legal impasse with NTP, the company said Wednesday.

RIM disclosed the amount as part of its statement of first-quarter financial results. It is currently negotiating settlement terms in a licensing pact, potentially worth $450 million, with the Virginia-based patent-holding company.

A federal appeals court ruled last year that RIM had infringed on NTP's intellectual property. The two sides were hammering out terms as part of a March 16 agreement when the talks broke down earlier this month. Details haven't been made public, but the U.S. Patent Trademark Office is currently reviewing the conditions of the eight patents in question that NTP owns.

Waterloo, Ontario-based RIM has been able to continue selling its wireless BlackBerry devices in the United States while a federal court of appeals reviews the case. The court is expected to send the case back to the U.S. District Court for the Eastern District of Virginia for consideration.

Despite the legal wrangling, RIM is toasting a milestone. The company said in its earnings statement that its subscriber base has pushed past the 3 million mark, thanks to the addition of 592,000 members in the first quarter, ended May 28.

RIM also reported its first-quarter revenue hit $453.9 million, up 12 percent compared with the previous quarter. The breakdown in revenue was approximately 69 percent for handhelds, 17 percent for service, 11 percent for software and 3 percent for other revenue, the company said.

RIM's shares closed at $75.91, down 69 cents or almost 1 percent on the previous day's close.

 

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