Research in Motion Begins a Fight for its Life

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A court case started today that will decide whether the BlackBerry line of wireless handhelds will continue to thrive or pass into the history books.

Research In Motion (RIM), maker of the BlackBerry line, has been involved in a bitter patent-infringement lawsuit with NTP Inc. for several years.

At issue is a dispute over eight patents held by NTP that relate to wireless email processing. NTP contends that RIM’s BlackBerry handhelds infringe on those patents and filed suit in November 2001, seeking to prevent RIM from selling the devices. In November of 2002, a U.S. jury found in NTP’s favor.

Last August, at NTP’s request, a judge issued an injunction that completely blocks RIM from selling BlackBerries in the U.S. However, the judge also ruled that this not go into effect until after RIM has had a chance to appeal the decision. That appeal started today in Washington.

Maneuvering for Position

No matter what the appeals court rules, it’s possible this won’t be the end of RIM. Many experts believe NTP just wants RIM to pay it a fee to license the patents, as NTP doesn’t make a rival wireless handheld.

However, RIM continues to insist that NTP’s patents are invalid and refuses to license them. The companies have gone into court-ordered negotiations on this issue before, but were unable to come to an agreement.

If NTP emerges victorious from this process, it’s possible that RIM will give in and pay the fees, rather than shut down operations in the U.S. However, this isn’t certain.

Not Your Average Court Case

This case has had some unusual twists. In early 2003, the House of Representatives sent a request to the lawyers on both sides asking that nothing to done to stop RIM’s wireless service because House members use it to communicate. Congresspeople were issued BlackBerries after 9/11 as a way to keep in touch in the event of a national emergency. The judge in the case did not take kindly to the politicians’ attempt at interference.

Despite possible doom hanging over its head, RIM has been on a roll recently. It has had three profitable quarters in a row. According to market researcher Gartner, Inc., RIM was the third biggest seller of handhelds during first quarter of 2004.

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