BlackBerry showdown nears

The plot thickens. After nearly four hours of arguments in a district court in Richmond, Virginia, Judge James Spencer said he would not impose an immediate injunction against BlackBerry maker Research in Motion. Judge Spencer said, however. That there was no escaping that RIM had been found to be infringing on NTP’s patents and he would issue a decision on an injunction “as soon as reasonably possible.” Arlington, Virginia-based NTP and Waterloo, Ontario, Canada-based Research in Motion (RIM), maker of BlackBerry were heading into court today for a resolution of their patent infringement dispute. In 2001 NTP sued BlackBerry, and a year later a federal jury agreed that RIM had infringed on the smaller firm’s patents. The jury awarded NTP 5.7 percent of U.S. BlackBerry sales— a rate that U.S. District Judge James R. Spencer later increased to 8.55 percent.

RIM argues that the U.S. Patent and Trademark Office is poised to reject all of challenger NTP’s patents. Indeed, the patent agency this week rejected the first of five patents closely tied to the court case. Judge Spencer had said he was unwilling to delay his proceedings while awaiting final word from the agency, but it is not clear whether he would wait or not. RIM also said that an injunction to cease operations in the United States would undermine U.S. national security because many government officials and private sector employees involved with U.S. critical infrastructure rely on the device to communicate with each other. Large government contractor Science Applications International Corp. (SAIC), for example, said there would be national security implications if communications between the company and its government customers were impacted. “NTP apparently is laboring under the mistaken belief that such an injunction enforced against SAIC would not involve national defense, national security, homeland security or public interest concerns,” the company wrote. “These assumptions are flat wrong.” Yesterday there were several court filings from other businesses concerned about any injunction.

Spencer has already issued an injunction in 2003 but held off on its enforcement during RIM’s appeals. NTP is now asking Spencer for a permanent injunction. The company also argues that RIM users have many alternatives, and said it would agree to grant exemptions to government and emergency workers. The U.S. Justice Department, however, will appear in court to express its concerns about a BlackBerry shut-down.

Analysts say that regardless of the judge’s ruling BlackBerry will not go dark, as RIM would be willing to pay as much as $1 billion to settle the case if the ruling went against it. In addition, RIM said it would introduce new software which would not violate NTP’s patents.

-read more in this CNN report