$612 million payout; who won?
Finally, Blackberry/RIM and NTP have settled their legal dispute with Blackberry paying NTP $612 million, which led to RIM’s stock going up 19%?! Well, how RIM won is in the details. CNN - FNC
First, RIM already lost the patent dispute with NTP back in 2002. The subsequent settlement from that decision was to have RIM pay NTP $450 million with NTP also getting 4% royalties on RIM sales, and some licensing restrictions. This deal fell through and ever since then, RIM has been attacking NTP’s patents at the Patent and Trademark Office. Since 2002, 3 out of 5 NTP patents that RIM infringed upon have been given preliminary rejections upon review. One of the 5 was given a final rejection, with the fifth very close to another preliminary rejection. But since the patents were legal back in 2002, this had no bearing on the court case, but it did take away alot of leverage that NTP had.
The latest deal is a total win for RIM since there are no more royalties for NTP, and there are no licensing restrictions. RIM had already placed $450 million in escrow back in 2004, so they only need to come up with $162 million to make this final payment. With all the pent-up sales for Blackberry products in the wings, the stock market looks to see a solid 2nd quarter for RIM, which will more than compensate for the $162 million that will hit the books in the 4th quarter of this year.
Dirty pool begets dirty pool. It’s not pretty, but that is capitalism at its worst best