Storage Computer threatens multibillion dollar lawsuits

The multibillion worldwide storage market could be in for a major shake-out following a recent patent-related decision in favour of Storage Computer.

The company plans to "vigorously defend its intellectual property rights" over the underlying technology of many disk array storage subsystems, according to one top official.

A source close to Storage Computer claimed a string of lawsuits aimed at the big names in the storage market could follow.

Computerworld approached several of the leading local storage vendors, but none were prepared to comment, saying they had not as yet received any information about potential legal action.

The move follows Storage Computer's exhaustive 10-year defence of its technology patent application lodged with the European Patent Office (EPO).

Storage Computer claimed the patent encompasses the core technology underlying virtually all computer storage subsystem products made and marketed by numerous companies throughout the world.

None of those vendors held licences for the patented technology, the company added.

Critical patents cover SCSI disk arrays, parity-protected disk arrays, and Storage Computer's asynchronous storage known as RAID 7, the company said.

Commenting on the decision, Maurice Gonsalves, partner at Australian law firm Mallesons Stephen Jacques, said Storage Computer now has recourse under Australian intellectual property law to injunctions on the use of patented technology.

"Financially, the company can sue for damages or account of profits backdated to the date of patent application."

The account of profits could be substantial, with the worldwide disk storage subsystem revenues of about $US154.5 billion between 1994 and 1999, according to estimates by analysts IDC.

Storage Computer believes a substantial percentage of these storage subsystem sales infringe the company's patents and is now formulating a licensing and enforcement strategy to maximise the company's investment in the patented technology.

Originally filed with the Vienna-based EPO in 1991, the application was actively opposed by 'interested parties' to block its issuance in Europe.

According to Brandon Beretta, Storage Computer's Asia Pacific director, the patent was not opposed in North America or Australia. "The opposition to the European patent application was considered a test case," he said.

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