But Is the Case

By Carmen Nobel  |  Posted 2006-03-03 Print this article Print

Really Over?"> But the case also has brought concerns of future drawn-out patent disputes. "Its great to have moved beyond the legal battle," said John Halamka, CIO of Harvard Medical School and Caregroup Health Systems, a Boston-area hospital consortium that supports some 800 BlackBerry devices.
"However, I hope this settlement does not lead to more suits of this nature. Innovative companies could spend more time in court than on creating new products."
This is not the first time RIM and NTP have announced a settlement. In 2005, the two companies announced a settlement deal of $450 million, but the deal fell apart when the two companies could not agree to terms. And Judge Spencers case dismissal included an interesting phrase: "ORDER that this matter is settled, and by stipulation of the parties, this action is hereby DISMISSED WITHOUT PREJUDICE," reads a March 3, 2006, entry in his court docket. "When you do something without prejudice it usually indicates that it is not final," said Neil Smith, a patent attorney at Sheppard Mullin Richter & Hampton LLP, in San Francisco. "It doesnt mean that it is not binding, but its not as binding as it could be." However, Balsillie maintained that the new deal is final. "We know we took one for the team, but this is behind us," he said. Throughout the past several months of the dispute, RIM had been touting a technical backup plan that customers could implement in case of an injunction. While RIM officials said the workaround plan did not infringe on any patents, and that "dozens" of customers had tested it out, there was still fear surrounding it. "Customers said, We liked the workaround, but we dont enjoy this uncertainty," Balsillie said. "At that point, if you can get a fixed-rate payment with no residual ... a smart person just puts it behind him. When that opportunity was able to be had we just took it." Indeed, the NTP dispute apparently caused some prospective RIM customers to hold back. Also on March 3, RIM said the number of new subscribers would be in the range of 620,000 to 630,000 for the fiscal fourth quarter, down from the companys December projection of 700,000 to 750,000. RIM also cut its revenue outlook for its fiscal fourth quarter. The company said revenue will be $550 million to $560 million, compared to its previous projection of $590 million to $620 million given in December. RIM said software and service revenue was lower than expected. As for the bottom line, RIM said it sees earnings of 64 cents a share to 66 cents a share, well below the companys expectation for earnings between 76 cents a share to 81 cents a share. Those earnings results exclude RIMs NTP settlement. Editors Note: This story has been updated to include comments from NTP and RIM, customer and analyst reaction, and information about a previous settlement, and will continue to be updated as events warrant. Check out eWEEK.coms for the latest news, reviews and analysis on mobile and wireless computing.


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