Ottawa's Wi-LAN sues RIM, Motorola, for patent infringement

Wi-LAN Inc. is suing Motorola, Research in Motion and UTStarCom for alleged infringement of the Ottawa patent-licensing company's intellectual property. The company announced Friday it had filed the suit in a Texas court that is a favourite of patent-licence companies seeking big judgments. In October, Wi-LAN used the same court to file an omnibus suit against 22 other major companies for alleged violations of other Wi-LAN patents. The decision to sue more companies could be a sign that many target companies are choosing to fight rather than quickly settle in the midst of uncertainty about the state of the economy. Wi-LAN said it will use McKool Smith, a Texas law firm hired to handle the earlier cases, to lead this suit. The earlier cases named Intel, Apple, Dell and Best Buy among the defendants. Some companies could be waiting to see whether possible changes in U.S. legislation or decisions in U.S. courts shift the balance of power in patent licensing wars. Wi-LAN also said Friday that it has settled a dispute with Marvell Semiconductor in a California court. Results were not disclosed. Marvell, one of the targets of last fall's suits, countersued, seeking a procedural judgment that Wi-LAN patents are not binding. While Wi-LAN has successfully negotiated licensing deals with many companies, including several announced this week, the cases that have gone to court are likely at least a year or more from reaching a stage where new settlement negotiations are possible. The company predicted last fall that it could take about 30 months to wrap up the earlier package of cases. Wi-LAN needs several big settlements to lift its flagging stock, which has fallen from $7.75 in early 2007 to under $2 in recent weeks. Shares rose 12 per cent, or 21 cents, to $1.96 on the Toronto Stock Exchange by midday Friday. Earlier this month, it predicted healthy revenues of up to $20 million this fiscal year and positive cash flow as new deals start to generate results. It had revenues of $3.2 million in the second quarter ended in March, a 40-fold jump from just $75,000 a year earlier. However, analysts had been predicting $4.5 million in revenues. The company lost $4.1 million, up 80 per cent from a year earlier, and higher-than-analyst expectations of $2.7 million. However, non-cash accounting charges for acquired licences generated $4.1 million of the costs. Cash reserves that are used to negotiate future deals and fight patent suits rose slightly to $91.8 million. The company will spend about $6 million this year on legal costs. Earlier this week, Wi-LAN announced new wireless patent deals with San Jose's Sena Technologies Inc. and Monsoon Multimedia of San Mateo, Calif., bringing the total to 25 of companies that are making or have made payments. It also announced several more licensing deals for a technology that allows parents to manage their children's television exposure, bringing the total number of such deals to 86. By Ms.Bobby Aanand, Metropolitan Jury.

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