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The last-minute settlement that has prevented a shutdown of the BlackBerry mobile e-mail service is unlikely to put an end to the push for reform to US patent legislation that the case has helped to spark, legal experts said.
The $612.5m payment by Research in Motion, maker of the BlackBerry, to end the patent infringement case brought by a small Virginia firm, NTP, was greeted with relief by the service’s users in the US, many of whom are senior business executives and financiers.
“It is more than a technology, it is an addiction,” Marc Benioff, chief executive of Californian software company Salesforce.com and one of the many executives tied to the gadget, typed into his portable device shortly after the settlement was announced.
While Friday’s settlement ends a legal threat to a widely used technology service, however, the high-profile case has probably already done enough to push forward the case for patent law to be reformed, experts said.
The threat to the BlackBerry has highlighted issues such as “whether the [US Patent and Trademark Office] needs more resources, whether it’s too slow or whether injunctions are a good remedy in patent cases,” said Carl Tobias, law professor at the University of Richmond. “Congress may end up legislating on some of these issues.”
John Carson, a partner of San Diego law firm Knobbe Martens Olson & Bear, said the case had drawn the attention of legislators in Washington to weaknesses in the US patent system that had made it possible for small companies with intellectual property claims to hold successful technologies hostage.
“You can not only threaten an industry, you can threaten consumers – and some of them are politicians,” he said.
According to RIM, all of the disputed patents held by NTP have suffered an initial rejection after scrutiny by the Patent Office, with the most recent rejections coming late last month. However, NTP’s patents remain valid until a final decision on its intellectual property rights, which could take years to resolve.
Separately from the patent office process, a judge in a US district court had threatened RIM with an injunction to block its service, and to award damages to NTP, if the two sides could not resolve their dispute out of court.
It was the risk of an imminent shut-down that prompted the payment by RIM, which was higher than a $450m it had tentatively agreed to pay under an earlier, failed settlement but less than the $1bn that NTP was pushing for.
One way to reduce the number of patent disputes that take place only after a technology has become widely adopted would be to allow earlier challenges to patent filings such as those made by NTP, said Mr Carson.
The patent registration systems in many countries allow “third parties to challenge patents soon after they have been filed,” he said.
Some experts have also argued that injunctions are too blunt an instrument to be used in the case of intellectual property disputes like this, since they can destroy a successful service built up by a company like RIM.
The BlackBerry case “serves as another reminder of the precarious state of intellectual property law in the US,” said Roger McNamee, a Silicon Valley financier.
“The lack of attention to these issues will certainly cause real harm – we were very lucky in this case that it was averted.”
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