U.S. Patent Office Sides with RIM

The U.S. Patent and Trademark Office has indicated that it will formally and finally reject the patents at the heart of a lawsuit in which NTP Inc. is suing BlackBerry maker Research in Motion Ltd. for patent infringement.

But while such a ruling would be good news for RIM and its customers, industry experts say that it will likely take several months before such a ruling would be final.

The USPTO last week rejected two of five patents at the center of the legal battle that threatens to shutter the BlackBerry e-mail service in the United States.

While the rulings were "non-final actions," meaning NTP can appeal them, the office made a point of indicating that it aims to reject them eventually.

"The present Office Action would have been a final Office action but for new rejection based on a Norwegian Telecommunications Administration printed publication that was made of record in related re-examination proceeding," read the latest USPTO ruling rejecting patent number 5,436,960, which is known somewhat colloquially as the 960 patent."

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"The present Office action is non-final, even though the Patent Owners arguments were deemed unpersuasive," the ruling reads. "The next Office action is expected to be a Final Office Action."

This marked the third time in the past month that the USPTO had issued a negative ruling on a disputed patent from NTP Inc., the patent-holding company that sued BlackBerry maker Research in Motion Ltd. for patent infringement in 2001.

U.S. District Judge James Spencer ruled in favor of NTP in 2003, instructing that RIM halt its sales of BlackBerry devices and services in the United States until NTPs patents run out in 2012.

He stayed the ruling, though, pending appeal. Since then, the case has gone through several appeals, and RIM is trying to take the case to the Supreme Court.

In the meantime, the USPTO has been evaluating the validity of NTPs patents. The office initially rejected NTPs claims in March, and it has been re-evaluating them for months.

RIM has been trying to persuade the courts to stay any final ruling until the USPTO finishes its evaluation, pointing out that the office has a team dedicated to re-evaluating these patents.

Still, industry experts said that the process could take several months, even if it does go in RIMs favor.

"Despite the Patent Offices dedicated re-exam group, I would expect that the Patent Office Board of Appeals—the final agency decision—will not occur in this case until around October next year," said Stephen Maebius, an attorney at Foley and Lardner LLP in Washington, who worked at the USPTO in the early 1990s.

"If the judge issues the injunction, and NTP is unsuccessful at overturning the Patent Offices decision on appeal, then the injunction will ultimately have no effect.

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"But that could take awhile because NTP is allowed to appeal an unfavorable Patent Office Board decision to the Court of Appeals for the Federal Circuit, which could add a year or more to the proceedings."

Judge Spencer has said that he does not intend to wait for the PTO, but he has yet to issue an injunction.

RIM maintains that the company has tested and readied a legal technical workaround that would let the company continue offering its mobile e-mail service even if the judge goes through with an injunction before the Patent Office makes its ruling.

The company has yet to offer the details of the promised workaround, but rumors have made their way to various Web sites, including a blog dedicated to the subject.

According to the blogger known as Enterprise Spy: "There are [as far as I have seen] two versions. One is indistinguishable from the current service [The StealthBerry] and the other is far more interesting and introduces more features [dubbed The Blackcherry or The StrawBerry] that will be integrated into future models if a settlement is not reached with NTP."

RIM officials said that the company will release details of the workaround in the near future. They declined to say when, but the company is releasing its fiscal third quarter results to the public on Wednesday afternoon.

"We didnt previously disclose details about the workaround because we didnt want to tip our hand to NTP. But we should be able to disclose more information soon," said Mark Guibert, vice president of corporate marketing at RIM in Waterloo, Canada.

"In the meantime, I wouldnt believe everything you read on the Internet."

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