BlackBerry Maker Settles Patent Lawsuit

Associated Press
Thursday, March 17, 2005

NEW YORK, March 16-- Research in Motion Ltd., the Canadian maker of BlackBerry wireless e-mail devices, said Wednesday that it will pay $450 million to resolve litigation with NTP Inc., a Virginia company that said the devices infringed on its patents.

NTP will grant the company and its customers the right to continue its BlackBerry-related wireless business without further interference from NTP.

The dispute began in 2002 when NTP, based in Arlington, Va., claimed that Research in Motion infringed on 16 of its patents.

In August 2003, a federal court in Virginia agreed that 11 of those 16 patents were violated and awarded NTP $54 million in damages, as well as an 8.6 percent royalty on all the revenue from U.S. BlackBerry sales. The court also ordered an injunction to prevent Research in Motion from making or selling its devices in the United States.

The injunction was stayed, however, while Research in Motion appealed. On Dec. 14, a three-judge U.S. appeals court panel struck down the verdict and injunction yet upheld most of the patent infringement claims, sending the case back to the lower court for reconsideration.

Research in Motion claims that its BlackBerry relay server -- through which all e-mails pass -- is based in Waterloo, Ontario, so U.S. patent laws have no jurisdiction. Most of the company's 2 million subscribers are in the United States.

On Wednesday, Research in Motion said the settlement fee relates primarily to past damages, and includes the $137 million judgment held in escrow.

Research in Motion's stock price rose $11.87 a share, to $78.96.

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