U.S. Appeals Court Tosses Bar-Code Patent Case

In a case that had threatened huge royalties penalties against major retailers-including CompUSA, Wal-Mart, Sears, LensCrafter and The Home Depot-the appellate panel ruled that a 51-year-old patent could not be applied to today's bar-code uses.

A U.S. Court of Appeals panel this week issued a ruling in a long-running patent infringement lawsuit that threatened retailers using bar-code readers. The panel affirmed a lower court ruling that the patent infringement case should not go forward.

The case involves several bar-code system manufacturers—including Symbol Technologies, Accu-Sort Systems, Intermec Technologies, Metrologic Instruments, PSC, Teklogic, Zebra Technologies, Cognex and Telxon—that were sued by a foundation that owns the patents from an early bar-code inventor named Jerome Lemelson.

The Lemelson Medical, Education and Research Foundation owns about 185 unexpired patents—some dating back to 1954—that involve machine vision and bar-code identification. After pursuing bar-code vendors for many years, Lemelson more recently sent letters to major retailers suggesting that they might be targets as well. Among the retailers involved were CompUSA, Wal-Mart, Sears, LensCrafter and The Home Depot.

Some retailers have already paid money to Lemelson to settle the case, said Ray Sweigart, an attorney representing a friend of the court filing from the National Retail Federation.

The appellate panel accepted a decision from a Nevada U.S. district court panel that rejected Lemelsons lawsuit for a few reasons, including that "Lemelsons 18-to-39-year delay in filing and prosecuting the asserted claims under the fourteen patents-in-suit was unreasonable and unjustified."

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The court also said that todays techniques—used by Symbol and the other defendants—are so much more sophisticated than what the patent described in the 1950s that it didnt make sense to force the defendants to pay royalties.

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