Intermec, Symbol Step Up RFID Patent War

Sparring over intellectual property issues since last year, major RFID players Symbol and Intermec expand their fight with a lawsuit around 802.11 wireless, a countersuit and a tug of war over laser scan engines.

In the latest round of a long intellectual property battle echoing across and beyond the RFID landscape, Intermec Technologies this week slapped Symbol Technologies with a countersuit charging infringement of six Intermec patents for wireless access, terminal and software technology.

Intermec Technologies Corp.s lawsuit against Symbol Technologies Inc., filed Wednesday, quickly followed a suit filed March 10 by Symbol, which charged Intermec with violating Symbols patents for 802.11, a wireless standard that is different from RFID (radio-frequency identification).

Also this week, Intermec accused Symbol of "breaching the terms of [its] supply chain contract with Intermec" for laser scan engines, an accusation since denied by a Symbol official during an interview.

"We did not breach our contract [with Intermec]. We were within our rights to discontinue the contract," Phil Lazo, vice president and general manager of RFID infrastructure at Symbol, said in the interview Friday.

"[Intermec] had the choice of negotiating to reach a settlement—but they chose not to be reasonable, and not to reach an agreement."

Yet these activities—both inside and outside of court—constituted only the latest installment in a heated and protracted struggle between the two vendors that began last summer when Symbol purchased Matrics, a big competitor of Intermecs in the RFID space.

/zimages/1/28571.gifRead more here about Symbols purchase of Matrics.

"We do believe that Intermec is infringing on Symbols patents for wireless technology," Lazo said this week. But, he added, this months events are also directly related to a broader dispute about Intermecs decision to levy licensing fees—to Symbol and other members of the EPCglobal standards group—for use of Intermecs own RFID patents.

"[Symbol] believes that the basic RFID technology between the reader and the tag should be royalty-free, in order to provide the lowest cost [to customers]," Lazo said. "We believe that we should all be thinking about how to grow this new [RFID] market. We dont think that placing a tax on this industry provides the best environment."

Prior to the Symbols buyout of Matrics, Intermec already had brought Matrics to court, charging violation of four other patents, completely different from those at issue in the suit Intermec filed against Symbol this week.

Patents covered by this weeks suit against Symbol include "a coherent, integrated wireless system capable of distributing data over a network; battery-powered data-processing devices capable of running in a multitasking operating system; and handheld, portable data-capture devices with graphical user interfaces; the ability to accept handwritten information; and the ability to process that information," according to Intermec.

Last summer, on the other hand, Matrics got charged with violating four Intermec patents specifically related to RFID. Intermec garnered two of these four patents through an acquisition of IBMs RFID Lab in 1997, Mike Wills, vice president and general manager at Intermec, said in an earlier interview.

Figuring out how to handle these same four patents also delayed passage of EPCglobals Generation 2 standard—originally slated for last fall—until early this year, according to sources inside the standards group.

/zimages/1/28571.gifClick here to read about the dangers of "following the leader" in RFID.

EPCglobal ultimately created a standard that can be implemented either with or without the use of Intermecs patents. But if vendors want to implement Gen 2 in ways that violate Intermecs patents, theyll need to negotiate royalty payments with Intermec, Michael Meranda, president of EPCglobal U.S., said in another interview.

Yet Symbol also contributed five other patents to EPCglobal for use by the industry free of charge, according to Wills.

For its part, Intermec donated patents for RFID Class 0 in the first-generation EPCglobal standard, Lazo said this week.

"We think Symbol is in great position for Gen 2. We have a lot of Gen 1 customers out there who are ultimately upgradeable—and weve learned a lot of good lessons along the way," Lazo said.

Essentially, Intermec officials took the position that they dont really need Symbols laser scan engines, anyway, citing Symbol scan engines already in the companys inventory, outside sources for other scan engines and plans to introduce its own laser scan engine later this year.

Also this month, Unova Inc., Intermecs parent company, sold its Cincinnati Lamb business for $60 million, a move seen by some observers as bringing Unova closer to eliminating its industrial division and concentrating more keenly on RFID and bar-code scanning instead.

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