The Blackberry Lawsuit

One of the more interesting cases to appear on the technology front recently is the patent dispute involving RIM (Research In Motion) with its Blackberry handheld device, and its alleged patent infringement with the inventor of the technology, Thomas Compana Jr.

The immensely popular Blackberry device, a PDA (Personal Digital Assistant) similar to the ubiquitous Palm Pilot, has one big feature that sets it apart; the ability to send and receive email, contacts and schedules wirelessly without the need to be docked to a computer.

Unfortunately for Canadian owned RIM, the technology it uses allegedly infringes upon a number of patents registered by Thomas Compana Jr back in 1991. RIM made the case that it didn’t know about the patents at the time, but Mr. Campana’s company, NTP, argued that RIM simply did not research deeply enough before releasing the Blackberry product. NTP offered a license, but RIM’s lawyers decided that there was no infringement and declined the license offer. With this refusal, NTP filed suit against RIM. During the 13 day trial, the jury found RIM had infringed upon no less than 5 NTP patents.

The monetary damages in this 2002 trial amounted to $53 Million, but the bigger problem for RIM was the threat of an injunction, which could shut down the service for the estimated 4 million US-based Blackberry users, many of which are US Government personnel. RIM appealed and won a stay until December 2004.

This story has many strange twists and turns, but perhaps the biggest irony is that by the time of the settlement earlier this month for a whopping $612.5 Million, the plaintiff was no longer around to enjoy the fruits of his victory – he had died of cancer 3 years earlier.

The settlement caused RIM’s stock to jump 13% as Blackberry users around the US heaved a collective sigh of relief that their addiction, no less their investment, was not going to be shut down and rendered useless. It is interesting to note that NTP didn’t really want the system to be shut down, as it would then be ineligible for the royalties it was also fighting for. As it turns out the settlement rules out any royalties for NTP.

Interesting Blackberry facts:

• “Blackberry Thumb” is a new medical malady, afflicting many, caused by repeated use of the thumb scroll-wheel incorporated by Blackberry
• Blackberries are meant to increase productivity by giving users mobility, but many have become so addicted to email that productivity for many has actually decreased, so much so that the Blackberry has been nicknamed the Crackberry.
• Blackberry is planning to incorporate instant messaging such as Yahoo Chat into their devices, making them even more addictive, and also making them attractive to the younger “instant messaging” generation.