California Jury Finds RIM Guilty of Patent Infringement
California – There was more bad news for the beleaguered creators of Blackberry last week. After a three-week trial and a week of deliberations, an eight-person jury found Research In Motion (RIM) guilty of patent infringement.
The decision, handed down last Friday in Northern California, was based on allegations that the Canadian Blackberry maker was illegally using patented technology created by New Jersey based Mformation for managing wireless devices. Initiated in 2008, the lawsuit alleged that the Blackberry Enterprise Server (BES) was based on Mformation’s patents for wireless device management. The Mformation software was designed to allow companies to remotely access employee cell phones in order to erase data from stolen phones, update software or change passwords. The Canadian Blackberry Company was subsequently ordered to pay 147.2 million dollars in damages, approximately eight dollars for each of the 18.4 million Blackberry devices connected to the Blackberry Server from the day the lawsuit was filed to the start of litigation.
RIM has already suffered tremendous setbacks in the past year as its market share has further declined, revenues dropped and its stock is at a nine-year low. Experts speculate that RIM’s struggles are undoubtedly a result of increasing Apple and Google smartphone popularity. At the height of its popularity, Blackberry captured 41% of the market share for its devices in 2007. However, that number reportedly dropped to under 4% in the first quarter of 2012. Once known for its cutting edge products, RIM has suffered as its consumers are gradually switching to iPhones and other smartphones that allow users to do more sophisticated applications beyond just checking emails and making phone calls.
Shareholders, employees and users are definitely watching anxiously to see how RIM will deal with its latest legal woes. In the wake of a year of negative news, RIM recently also announced it was cutting 5000 jobs, or roughly 30% of its workforce in an attempt to reduce operating costs. Blackberry further saw its opportunity to catch up with its competitors wane after reported delays in its Blackberry 10 Operating Systems. Representatives for RIM expressed disappointment with the court’s decision and will likely appeal the decision. The judge involved in the case is reportedly still reviewing certain other legal issues related to the lawsuit.
Posted in: Patent Infringement