RIM ordered to pay extra damages in patent case

Research in Motion (RIM), the company behind the BlackBerry wireless e-mail device, was ordered to pay almost US$9 million in enhanced damages in a post-trial ruling on a patent dispute with NTP, a U.S. court ruled Friday.

Last November, a jury in the U.S. District Court for the Eastern District of Virginia found in favor of NTP's claim that RIM had infringed on NTP's patents relating to the wireless transmission of e-mail, and awarded damages of over $23 million.

NTP then asked the judge to rule that RIM's infringement of the patents was "wilful," a decision which could result in the damages being tripled.

On Friday Judge James R. Spencer found in favor of NTP, but ruled that qualifying compensatory damages of $17,736,720 would be enhanced by a factor of only 0.5, resulting in an award of enhanced damages against RIM of $8,868,360, according to court documents. He also awarded attorney's fees to NTP, but reduced by 20 percent.

RIM plans to make provisions for the damages and other charges in its accounts for its 2003 and 2004 fiscal years, it said in a statement Monday. It will make an additional accounting provision of $13.75 million to $14.25 million to account for the enhancement to compensatory damages, and around $5 million for NTP's attorney fees, it said.

This will bring total provision for litigation in RIM's fiscal year 2003, ending March 1, 2003, to between $58.25 million and $58.75 million, the company said. The company will also make provisions in its quarterly accounts for fiscal year 2004 for enhanced compensatory damages and post-judgment interest, it said. It estimates these will total $8 million to $9 million in its first fiscal quarter, which it expects to report on June 25.

The matter is not closed yet, RIM warned in its statement. A variety of matters, including damages awards and last November's jury verdict, remain subject to appeal.

However, RIM's avenues for escape are narrowing: On Friday, the judge also rejected two requests by RIM for a new trial.

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