[Patent Issue]
Further fuel for thought......
From the Orckit Prospectus........"DMT technology, a portion of which is subject to patents owned by Amati, Telebit Corporation and Motorola Corporation has been selected by ANSI and ETSI as the standard for ADSL transmission..............The Company has received letters from Amati claiming that the Company's ADSL technology infringes patents that Amati holds on its DMT technology and offering the Company the opportunity to enter into licensing discussions regarding Amati's ADSL patents.............the Company believes that the Company's ADSL product can achieve the required performance without infringing any valid claim of such patents and that it does not require a license from Amati in order to sell its ADSL products. The Commpany has responded to Amati indicating that, although it does not believe that the Company's ADSL product uses Amati's patents, it is willing to discuss a license with Amati.........there can be no assurance that a court to which the issue is submitted would not find that the Company's ADSL products infringe the Amati or other patents, nor that Amati will not continue to assert infringement. If the Company is found to have infringed any of such patents, the Company could be subject to substantial damages and/or an injunction preventing it from selling its ADSL products, and the Company's business could be materially and adversely affected."
And from Aware's prospectus: "The Company has received letters from two companies, Amati Communications Corporation ("Amati") and Telebit Corporation (Telebit"), each asserting ownership of certain U.S. and foreign patents, claiming that the Company's ADSL technology would infringe such patents and offering the Company the opportunity to enter into a license agreement with respect to such patents. The Company has been informed that ADI has received similar letters. The Company has reviewed the Amati and Telebit patents and has received an opinion of its patent counsel, based upon the Company's *oral* description of its technology, to the effect that the Company's ADSL Internet Access Modem which it intends to sell does not infringe any valid clailm of any of the Amati and Telebit patents. Based upon this opnion, the Company believes that it does not require a license under the Amati or Telebit patents in order to conduct its proposed business. Despite this opinion, there can be no assurance that a court to which the issue is submitted would not find that the Company's products infringe the Amati or Telebit patents, nor that Amati or Telebit will not continue to assert infringement."
It appears to me that two of Amati's rivals unquestionably acknowledge that Amati owns key ADSL patents. The challenge for Aware and Orckit will be to market a modem without violating those patents. It appears that an injunction could result if deployment were attempted---and that Telebit or Motorola could be asserting the infringement--not necessarily Amati. Of course, Aware and Orckit can license whenever they want for a nominal fee. Any comments out there?
Later
Steve |
