Judge Says All Handhelds May Infringe on Patent

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A federal judge has ruled that a patent held by E-Pass Technologies covers more than just credit card-sized handhelds, which brings new life to patent-infringement lawsuits the company has filed against Palm, Microsoft, and Hewlett-Packard.

In 1994, Hartmut Hennige, E-Pass’ founder, was granted a patent for a multifunction, credit card-sized computer that allows users to securely store account numbers, PIN codes, access information, and other data from multiple credit cards, check cards, identification cards, and similar personal documents.

In 2000, E-Pass filed a lawsuit against 3COM, who was then the maker of Palm handhelds, on the grounds that its handhelds infringed E-Pass’ patent. It filed a similar lawsuit against Microsoft and Compaq in 2002. According to E-Pass, Microsoft had attempted to buy the rights to the patent for $10 million, but E-Pass refused. Rather than raise the price, E-Pass claims Microsoft decided to ignore the patent.

Later in 2002, a federal judge made a summary judgment that the lawsuit against 3COM was without merit, on the grounds that the patent covered only credit card-sized devices. The separate lawsuit against Microsoft and Compaq was put on hold, pending the appeal of the first case.

In the intervening time, Palm Inc. split off from 3COM and Compaq merged with HP.

Today, a U.S. Court of Appeals judge ruled that the E-Pass Patent is not restricted to just credit card-sized handhelds. Therefore, E-Pass intends to restart its lawsuits against Palm and Microsoft/HP in the next four to six weeks.

And this is only the beginning. E-Pass expects to file additional patent infringement suits against other handheld makers in the not-too-distant future.

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