RIM Wins on Appeal of $150 Million Payout for Patent Infringement

When you're a troubled technology company struggling to pay the bills, the last thing you need is a $150 million penalty for patent infringement. Yet, this was exactly the scenario Canadian Blackberry maker Research-in-Motion was facing after a jury found that the company infringed on patents owned by management software solutions provider, Mformation Technology.

The judge ordered the company to pay $147.2 million in damages to Mformation following the ruling.

The cash-strapped company, which is struggling to put itself back on track, appealed the ruling. On Thursday, RIM announced that it won its appeal and will not have to pay damages. The U.S. District Court for the Northern District of California concluded that the evidence did not support the jury’s finding of patent infringement.

RIM announced that after considering motions presented by both parties, as well as the jury verdict , the appeals judge determined that RIM had not infringed on Mformation’s patent. In granting RIM’s motion, the judge also vacated the $147.2 million jury award, eliminating the necessity for RIM to pay out to Mformation. Mformation does have the right to appeal the reversal, but if Mformation is successful in that endeavor, the jury verdict would not be reinstated. Instead, a new trial would be organized.

“We appreciate the Judge’s careful consideration of this case. RIM did not infringe on Mformation’s patent and we are pleased with this victory,” said Steve Zipperstein, chief legal officer for RIM.

“The purpose of the patent system is to encourage innovation, but the system is still too often exploited in pursuit of other goals. Many policy makers have already recognized the need to address this problem and we call on others to join them as this case clearly highlights the significant need for continuing policy reform to help reduce the amount of resources wasted on unwarranted patent litigation,” he added.

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