Kodak, Sun Settle Java Lawsuit

Updated: Sun will pay Kodak $92 million in exchange for a license for the patents at issue.

Eastman Kodak Co. and Sun Microsystems Inc. have settled their lawsuit over Suns infringement of Kodaks patents in the creation of the Java platform.

The two sides came to an out-of-court agreement Wednesday night, before they would enter the penalty or awards phases of a trial in which a jury found Sun guilty last Friday.

/zimages/4/28571.gifRead more here about the initial phase of the trial between Kodak and Sun.

Kodak said in a statement that it and Sun reached a tentative agreement to settle the lawsuit. Pending the signing of a final agreement, Sun will pay Kodak $92 million in cash in return for a license for the patents at issue. Additional details were not disclosed.

"We achieved our goals in this case, which was to protect our intellectual property rights," Willy Shih, senior vice president at Kodak, said in a statement. "We are pleased that the court has validated these fundamental Kodak patents, and we now look forward to building a more productive relationship and continued collaboration with Sun, with whom we have enjoyed a close partnership for nearly two decades."

But Kodak earlier this week said it was seeking more than $1 billion in damages from Sun.

A Rochester, N.Y., jury found Oct. 1 that Sun infringed on Kodaks patents when it created Java and released the technology in 1995. Kodak is based in Rochester and is the citys largest employer.

At issue were three patents that Kodak inherited when it acquired Wang Laboratories Inc. in 1997. Kodak claims that Java infringes on parts of these three patents.

"Kodak has, and continues to make substantial technology investments to ensure high-quality products," said James Blamphin, a spokesman for the company. "We are pleased that the court has validated our intellectual property rights protecting these valuable innovations for the benefit of our customers and shareholders."

One of the patents at issue indicates a means by which "two processes that are to cooperate in a data-interchange operation identify each other, and to identify data formats they have in common." And some observers say that, taken broadly, the same patents might be used to claim infringement by Microsofts .Net platform.

/zimages/4/28571.gifDoes the Kodak-Sun case illustrate deeper problems in the patent system? Click here for a column.

Sun denied that it infringed on the Kodak patents during a three-week trial. After the jury announced its finding, Sun spokeswoman May Petry said the company was prepared to defend its intellectual property rights.

"We intend to put on a vigorous defense and hope to reach a decision that will be in the best interest of shareholders, customers and Sun," Petry said in a statement released at the time. "We will also continue to vigorously protect and defend our IP when appropriate."

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Editors Note: This story was updated to include information and comments from Kodak.