Intermec Technologies Corp. yesterday took a swipe at RFID competitor Alien Technology Corp. with a patent infringement lawsuit that claims Alien's Generation-2 RFID readers and tags infringe upon 10 Intermec patents.
The suit, filed in the U.S. District Court for the District of Delaware, responds to a preemptive action brought last month by Alien, which in federal court in the District of North Dakota sought a declaratory judgment for patent non-infringement.
On an earlier earnings conference call, Intermec stated its intent to pursue litigation against certain companies, noted Linda Prosser, vice president of corporate marketing at Alien Technology. "They named Alien as one of the companies they intended to pursue," she told Managing Automation. "Alien chose to file, asking the court to take a look at the issue and make a determination."
In response, Intermec is asking the Delaware court to dismiss the declaratory judgment awarded by the North Dakota federal court to Alien on the grounds that the court does not have jurisdiction to hear the case.
Alien's general counsel defended his company's preemptive strike. "With this action, Alien is seeking to quickly resolve any confusion and uncertainty in the RFID marketplace about Alien's products created by Intermec's lingering public threats of litigation," said David Aaron, Alien's vice president and general counsel, in a statement. "Alien's objective in obtaining the declaratory judgment is to minimize burdensome royalties on RFID products for end users."
Intermec's IP protection efforts date back to the 2004 timeframe, when the Auto-ID company began contributing technology to EPCglobal Inc.'s then-emerging RFID standards-building initiative. Intermec was one of many companies that contributed intellectual property to assemble a global standard aimed at accelerating the adoption of RFID products and creating a robust and reliable infrastructure. While EPCglobal Gen-2 was meant to be royalty-free (with a specific patent pool to support the effort), Intermec has stated that some of its patents (beyond basic Gen-2 compliance) are value-add, and require a licensing fee.
Last summer, Intermec offered what it called a quick and easy way for vendors building Gen-2 products to license its more than 145-related value-add RFID patents. Some 19 companies joined RFID Rapid Start Licensing Program; Alien was not among them. Alien's decision not to license these patents appears to be the basis for Intermec's patent infringment claim.
Intermec is no stranger to IP litigation. Last year, the company battled with Symbol Technologies Inc. over intellectual property, a litigation chain of events that was spawned when Intermec sued Matrics Corp. over its alleged misappropriation of RFID technology, a company which Symbol later acquired.
The two companies continued to lob IP infringement suits at one another until the fighting was suspended last September when they reached an agreement to resolve their RFID differences. At the time, the two companies said discussions on other patent infringement claims covering Wi-Fi, laser, MEMS, software management, and Internet-based communication would be put on hold for a 90-day period. Settlement of those claims has yet to be disclosed, at least publicly.
Interestingly, the resolution of the companies' RFID differences coincided with the conclusion of Intermec's RFID Rapid Start Licensing Program.
Intermec officials were unavailable for comment at press time, but based on recent financial disclosures, its litigation strategy seems to be paying off. The company's first quarter earnings for 2006, issued on May 8, included $23 million in IP settlement revenue. Total reported revenues for the period were $226.8 million and net earnings from continuing operations were $15.1 million.