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RIM Strikes Back Against Visto

By James Alan Miller
May 4, 2006

Reserch In Motion(RIM) has stuck back at rival Visto, filing a claim stating it doesn't infringe on patents held by its competitor and that said patents are invalid to begin with. The company's next move may be the filing of a suit accusing Visto of infringing on its own patents.

The push e-mail leader launched its suit in a courthouse in Dallas, Texas, rather than the federal court in Marshall, 100 miles away; where Visto won 3.6 million dollars from another wireless messaging provider, Seven Networks, and launched its assault on RIM last week, claiming RIM infringes on four of its patents.

RIM explained its choice of venue as a matter of convenience. Jim Balsillie, RIM co-CEO & Chairman, told the Associated Press, “We believe the appropriate place for this to be heard is where we do business.” RIM has U.S. offices in nearby Irving.

“They literally drive right by the RIM headquarters (in Irving, TX) and drive another 100 miles to Marshall,” Balsillie said to the Telecommunications Industry News. “Neither RIM nor Visto has any business in the Eastern District of Texas. This one is just so obvious.”

Another reason for selecting Dallas over Marshall is the latter court's favoritism towards patent owners that go to a trial by jury, with 92 percent winning since 1994, and its fast moving docket. The Globe & Mail reports the U.S. District Court for the Eastern District of Texas in Marshall has seen a tenfold increase in patent litigation since 1999.

By filing the claim in Dallas, RIM is attempting to change the venue of Visto's lawsuit should it go to trial.

It's a trial investors and, especially, BlackBerry users would like to see avoided. After all, RIM only just settled its battle with NTP for $612.5 million dollars in March, in a case where all patents may become invalidated in the end.

Gartner analyst Ken Dulaney told internetnews he thinks RIM learned from the NTP debacle, as shown by its quick response to Visto's suit. "If they don't fight it, people will just come after them," Dulaney said. Because of their new legal team, RIM "know what levers to pull," he added.

NTP is now a part owner of Visto, which, unlike the patent holding company, actually sells something; albeit on a much smaller scale than RIM. The litigious Visto has suits running against Microsoft and Good Technology right now as well.

In addition to delivering its mobile e-mail and data access solutions to over 5 million subscribers, publicly traded RIM is also one of the most 'successful' smart mobile device vendors in the world - running a distant second to Nokia, according to Canalys. It commanded an 8.4 percent share during the first quarter to Nokia's 54 percent.

Closely held Visto has several hundred thousand customers through carriers like Sprint Nextel and Cingular in the U.S., and Vodafone in Europe, among others. Unlike RIM, Visto doesn't sell hardware, which accounts for 70 percent of RIM’s revenue.

While mobile e-mail is hot, only 10 or so million of the world’s 2 billion mobile phone users have it. It's a market many analysts think is set to explode to the tens, if not hundreds, of millions. Which is one reason we're seeing wireless messaging specialists gunning for each other any way they can; using the patent system rather than the marketplace, for example.

In the end, RIM may even settle this one rather than go through another protracted legal battle. In the meantime, the rhetoric is likely to heat up on both sides before it cools down.



Related Links:

  • Visto Wins Patent Suit, Sues RIM
  • RIM in China: BlackBerry Vs. RedBerry
  • The Man Who Invented Wireless E-Mail
  • RIM, NTP Both Win in Settlement
  • Smartphone Sales Soar

     
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