October 21, 2005 10:01 AM PDT

RIM denied stay pending court appeal

A U.S. District Court will be asked to reconfirm an injunction that could shut down Research In Motion's BlackBerry service in the United States after RIM's request to put the case on hold was denied on Friday.

The move is the latest development in a long-running legal battle between the Waterloo, Ontario-based company and U.S. patent holding firm NTP, which successfully sued RIM for patent infringement in 2002.

The case now heads back to U.S. District Court in Richmond, Va., where the initial injunction was issued in 2003. RIM has been able to continue selling its BlackBerry devices in the United States for the last two years while the courts have reviewed the case.

U.S. District Court Judge James Spencer, who presided over the original decision, is expected to consider whether to enforce an injunction prohibiting RIM from selling, using or importing into the United States any BlackBerry hardware or software that infringes on NTP patents until those patents expire in 2012.

The judge will also consider the tentative $450 million licensing settlement struck between RIM and NTP in March 2005 and then abandoned in June, after the United States Patent and Trademark Office began re-reviewing NTP's patent claims.

Final rulings from the USPTO are still pending. If NTP loses the decision, the company said it will appeal the ruling.

"We are not popping a champagne bottle at this point. There is so much more left that could happen," NTP co-founder Donald Stout told CNET News.com. "We are willing to enter a license with RIM and even write one up for them, but the terms must be beneficial to NTP."

Stout declined to clarify whether the sticking point was the amount of the settlement or the nuances of a potential licensing agreement, now that RIM's U.S. subscribers have shot up from about 400,000 in 2003 to approximately 3.65 million, according to RIM's quarterly financial statement in September. Lawyers will now need to transport enough boxes of legal briefs to fill a moving van, Stout said.

As it did earlier this month, RIM said it would continue to seek a review by the U.S. Supreme Court.

"While further review by the Supreme Court is generally uncommon, RIM continues to believe this case raises significant national and international issues warranting further appellate review," RIM said on its Web site.

NTP's patents relate to radio frequency wireless communications in e-mail systems. RIM's BlackBerry devices and messaging service enable wireless always-on access to e-mail and corporate data on portable devices.

While RIM maintains that the injunction is inappropriate, it warned investors that the decision will be up to the courts.

Trading of RIM shares were halted, pending Friday's news. Shares dropped $3.50 to trade at $61.16 on the Nasdaq. The company's shares sank earlier this month, when the same U.S. appeals court refused to rehear and reconsider the patent infringement ruling.

Reuters contributed to this report.

2 comments

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Wheres Homeland Security when you need them?
Blackberries were one of the few communication devices still operating on 9/11 in NYC. Any chance that the service would be shut down over something as inane as a patent dispute should be nipped at the bud.

Not to mention the withdrawals that users would be subject to, they arent called Crackberries for no reason.
Posted by Yukimi Konomi (48 comments )
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Wheres Homeland Security when you need them?
Blackberries were one of the few communication devices still operating on 9/11 in NYC. Any chance that the service would be shut down over something as inane as a patent dispute should be nipped at the bud.

Not to mention the withdrawals that users would be subject to, they arent called Crackberries for no reason.
Posted by Yukimi Konomi (48 comments )
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