A federal court in Texas has granted Australian science agency, the CSIRO, an injunction to prevent infringement of its wireless network patent by the Buffalo group of companies in the United States.
The injunction prevents the sale of all products until a licence to CSIRO technology is negotiated.
CSIRO CEO, Geoff Garrett, said it is another important milestone as injunctions have become rare following a May, 2006 decision by the US Supreme Court in a case involving eBay.
"The decision to grant an injunction recognises the strength of CSIRO's patent and the vital role of research institutions within innovative countries such as the US and Australia," Garrett said.
"In granting a permanent injunction the court recognised that income from patent licensing can be a very important factor in funding further scientific research and technological innovation."
Dr Garrett said that CSIRO had begun a test case against the Buffalo companies in February, 2005, after the industry had failed to accept the science agency's offers to licence its wireless local area network (WLAN) patents on reasonable and non-discriminatory (RAND) terms.
In a summary judgement in November, 2006, the court upheld CSIRO's position on the issues of patent validity and infringement.
The Buffalo case is ahead of other cases relating to CSIRO's WLAN US patent.
The other pending cases involve: Microsoft, Intel, Dell, Hewlett-Packard, Netgear, Toshiba, Fujitsu, ASUS, D-Link, Belkin, Accton, SMC Networks, 3Com, Nintendo and Marvell.
All of these cases are being heard by Judge Leonard Davis, and the CSIRO is being represented by US law firm Townsend and Townsend and Crew (TTC).
In a statement TTC said: " In the early 1990s, research scientists at CSIRO solved significant problems associated with designing a wireless network for computers. These problems had defeated many of the world's best companies at the time. CSIRO applied for patents in the US, Europe, Japan and Australia, and received U.S. Patent No. 5,487,069 ("the '069 Patent") on January 23, 1996.
"In 1999, the Institute of Electrical and Electronics Engineers ("IEEE") ratified the 802.11a wireless standard, and in 2003 it ratified the 802.11g wireless standard. The '069 patent is the core technology embodied in these standards, and products compliant with these standards infringe the '069 patent.
"CSIRO subsequently moved for a permanent injunction. Prior to May 15, 2006, it would have been fairly certain that such an injunction would have been granted. However, on that date in eBay v. MercExchange the Supreme Court held that the traditional four-factor test should be applied to injunctions sought under the Patent Act.
"This ruling effectively put a new burden on research institutions to show that they had suffered irreparable harm before they could obtain an injunction. Indeed, in the eyes of some the ruling created a two-tiered system where an injunction only could be obtained against an actual marketplace competitor, and where research institutions and solo inventors who did not make and sell products would not be able to prove irreparable harm where the infringer was not actually competing with them by selling products.
"In the year since the eBay decision, no permanent injunction has been issued to a non-competitor. The decision by Judge Davis is therefore seminal. Research institutions, including major universities, receive much of their funding by licensing inventions. Absent the threat of a permanent injunction, the motivation of an infringer to take a license would be greatly reduced. The harm through loss of funding to research and educational institutions would likely be immense."