The U.S. Supreme Court handed Research In Motion (RIM) a potentially devastating defeat in its five year legal tussle with patent holding company NTP Group today. RIM asked the high court to decide if it's guilty of infringing on U.S. patents when its base of operations was in Canada, where its main relay station for e-mail and data services is located.

High court justices refuse to hear the appeal from the BlackBerry maker, returning the case to the U.S. District Court for the Eastern District of Virginia; where it had already been decided that yes indeed RIM infringed.

"The District Court will set a hearing date at a later time for further proceedings in the case based on the remand from the U.S. Court of Appeals for the Federal Circuit," according to RIM.

Trial judge James Spencer could enforce an injunction against RIM selling its BlackBerry handhelds and mobi-e-mail and data access solutions in the United States. This is the same judge who refused to put in force a previously agreed upon $450 million settlement between NTP and RIM. Meanwhile, the two sides haven’t come close to seeing eye to eye on resolving the situation since, making millions of ‘crackberry’ addicts nervous.

RIM asserts it wasn't counting on high court intervention. VP of corporate marketing Mark Guibert says the company has "consistently acknowledged that Supreme Court review is granted in only a small percentage of cases and we were not banking on Supreme Court review."

There are reports that RIM has $200 million in its coffers to cover a settlement (plus $1.6 billion in cash and related assets on reserve), which most analysts believe will end up ranging from $700 million to $1 billion; either as single-payment or - more likely - royalties to NTP.

Earlier this month, the United States Patent and Trademark Office (USPTO) rejected two NTP patents, in a preliminary mode. The USPTO nixed another patent a month earlier and additional ones before that. While these rulings aren't final, they shed some doubt on the strength of NTP's lawsuit.

The Federal court judge said these USPTO rulings would have no bearing on whether he'd enforce the injunction or not, presumably because the patent rejections aren't final. And, it would seem, the patents weren’t rejected at the time RIM allegedly trampled on them.

Should RIM be forced to cease U.S. operations, NTP says it would grant a 30-day grace period to allow BlackBerry users to change services—there are plenty in the wings, including NTP's new partner Visto, Intellysync, Microsoft, Palm, etc., salivating at the opporunity—as well as exempt government users and first responders from a shutdown.

RIM bats around the idea of implementing a "workaround" should the court block it from selling its handhelds in this country. This idea has met some skepticism, however.

Market analyst Gartner, for example, said in December that a workaround solution could be "highly problematic." It added "RIM claims its work-around is legally sound, but its history in the courts does not inspire confidence. Moreover, end-user validation and implementation would take time, resulting in a temporary loss of service."

"The Patent Office continues its reexaminations with special dispatch, RIM's legal arguments for the District Court remain strong and our software workaround designs remain a solid contingency," according to Guibert; in spite of what Gartner and other say about its workaround plan or the Federal judge's willingness to rule before the patent situation is fully resolved.