A local provider of software and services for toll-tag systems has won what could become a precedent-setting appellate decision for patent licensing.
The United States Court of Appeals for the Federal Circuit - the primary appellate court for patent cases - in April upheld a ruling by a Dallas district judge. The ruling threw out a patent lawsuit against Richardson-based Electronic Transaction Consultants Corp.
A rival firm, Pennsylvania-based TransCore, sued ETC in November 2005, alleging patent infringement. TransCore had sought up to $60 million in damages, according to court documents.
TransCore declined to comment. The company has asked the federal circuit to rehear the case.
Transcore had sued ETC over four patents, but a key question for the court was whether the suit was essentially barred by a 2001 settlement between Transcore and Amherst, N.Y.-based Mark IV Industries. The settlement involved three of the same patents.
‘Very significant'
Jamil Alibhai, chairman of the litigation section of Munck Carter LLP in Dallas, says the federal circuit decision is "very significant, especially in the resolution of cases through a settlement agreement."
When negotiating settlement agreements in patent disputes, Alibhai says, parties and their attorneys "will have to take into consideration that they're exhausting the patent holder's rights, which may mean they have to negotiate higher royalties or put additional protections in those (settlement) agreements," he says.
http://www.bizjournals.com/dallas/stories/2009/05/04/story2.html