RIM hits patent deal impasse

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Shares in Research in Motion fell sharply on Thursday after the Canada-based maker of BlackBerry mobile e-mail devices said it was going back to court after hitting an impasse in finalising a $450m patent dispute payment to NTP, US-based patent holding company.

RIM's shares fell more than 5 per cent yesterday to $73.55 after the company disclosed that it has asked the US courts to enforce the terms of a court-approved deal struck with NTL in March designed to end a long-running patent dispute between the two companies. RIM said it was returning to court because, “NTP refuses to honour its obligations”.

The company added that it was reviewing any potential accounting implications of the latest developments and would provide a further update when it reported first-quarter fiscal 2006 results on June 29.

RIM said it has already set aside the funds to make the payment. NTP successfully sued RIM in 2002 for patent infringement and won an injunction in 2003 halting US BlackBerry sales. That was suspended pending the outcome of the appeal process.

In December the appeals court upheld the patent infringement finding but said part of the earlier ruling was flawed and sent the case back to a lower court which sanctioned the proposed $450m payment by RIM in March.

Although the settlement was one of the largest of its type, it was welcomed by shareholders because it appeared to remove a major uncertainty hanging over the stock. In the immediate wake of the proposed settlement, RIM's share's gained 17 per cent.

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