In a much needed victory for Research In Motion, the BlackBerry maker has won an appeal in court that will save it $147.2 million in cash. RIM on Thursday said a judge in a patent action brought by Mformation in the U.S. District Court for the Northern District of California reversed a jury award in the case.
After considering motions presented by both parties, as well as the jury verdict, the judge determined RIM had not infringed on Mformation's patent. Ultimately, that means that RIM is not required to make any payment to Mformation.
Although Mformation has the right to appeal the judge's ruling, if Mformation successfully appeals then the jury verdict would not be reinstated. Instead, a new trial would be scheduled.
"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, RIM's chief legal officer.
"The purpose of the patent system is to encourage innovation, but the system is still too often exploited in pursuit of other goals," Zipperstein said. "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."
Removing a Dark Cloud
Rob Enderle, principal analyst at the Enderle Group, told us this was excellent news that RIM badly needed. He said it removed another dark cloud over the company when it needs all the help it can get.
"A $147 million judgment would put RIM under extreme pressure, and they need every cent they've got to get through the year and get their next generation of products out the door -- or at least survive until they are acquired or something else happens," Enderle said.
Meanwhile, the merger and acquisition rumors are swirling around RIM again, especially in light of the Samsung-Apple patent suit. Samsung has stated that it has not considered acquiring RIM or even licensing its coming BlackBerry mobile operating system, BB10. But Enderle said he's not buying.
"Samsung popped up today and said they hadn't even considered RIM and that can't be true. They could certainly say that they'd thought about acquiring RIM and decided not to do it, but there is absolutely no way they didn't consider it," Enderle said.
As he sees it, there is more going on than Samsung is willing to talk about. It is not unusual for a company that is considering an acquisition to deny it in order to avoid a spike in the company's valuation.
"Samsung is losing against Apple in court. They need RIM's patent portfolio to take Apple from the offensive and put them on the defensive. Really, it's the only patent portfolio out there than can do that, unless HP sells them the Palm patents or something along those lines," Enderle said.
"With RIM they'd get a more dedicated position in business, which they might be able to leverage into something else and stop copying Apple. Samsung could justify, for the right price, buying RIM."