By Carmen Nobel
January 27, 2006
Analysis: The BlackBerry patent saga and worries over a potential
shutdown continue. Here's what you need to know to avoid being
The Research In Motion and NTP patent dispute provided a few more
twists and turns this week as the Supreme Court refused to hear an
appeal and a federal court judge set Feb. 24 as a key hearing date.
On Jan. 23, the Supreme Court refused to hear an appeal in an ongoing
battle that has loomed over BlackBerry customers for years.
Then on Jan. 25 a federal judge set a Feb. 24 hearing date in the
Eastern District Court of Virginia to consider a possible injunction
that could shut down BlackBerry wireless e-mail service in the United
What's next? More court hearings. More big headlines. And more big
questions facing enterprises as managers ponder what it will mean for
business if the BlackBerry goes bust.
With that in mind, here's an FAQ to help you map out a plan.
What's the back story?
Holding company NTP sued Canadian BlackBerry maker Research in Motion
for alleged patent infringement on nine wireless e-mail patents in
U.S. District Judge James Spencer ruled in favor of NTP in 2003,
instructing RIM to halt its sales of BlackBerry devices and services
in the United States until NTP's patents run out in 2012.
Spencer stayed the ruling, however, pending appeal. Since then, the
case has gone through several appeals and failed settlement attempts.
In the meantime, the U.S. Patent and Trademark Office has been
re-evaluating several of the disputed patents for months. The USPTO
has indicated that it intends to reject all of NTP's claims
eventually, in which the case would be null and void.
Industry experts said the process could take several months, though,
as NTP has voiced plans to appeal every decision it can.
Since Judge Spencer ruled against RIM, NTP has secured patent
licensing deals with several of RIM's competitors in the remote access
software industry, including Nokia in June 2004, Good Technology in
March 2005 and Visto in Dec. 2005.
"RIM refuses to take a license and pay NTP," said Kevin Anderson, an
attorney with Wiley Rein & Fielding of Washington, one of the law
firms that represent NTP.
"If someone camps on your front lawn and refuses to pay you, you have
no choice but to seek assistance in removing the squatter."
How ugly can this get?
Very ugly. Of the 4.3 million BlackBerry customers worldwide, 75
percent are in North America. For those customers, the worst thing in
the near term would be for Judge Spencer to shut down BlackBerry sales
and services in the United States, which could happen after the Feb.
For those who use their BlackBerrys as cell phones, the phone service
would remain in place, but the e-mail service would be shelved.
"While removing BlackBerry support from my life does seem very
appealing, the truth is this service has become an integral part of
our day-to-day business operations," said Nick Gass, IT manager at
Color Kinetics, a digital lighting company in Boston.
"Our sales team relies on their BlackBerry devices as their primary
means of contact, and our executive team uses them to an almost manic
degree. BlackBerries have become practically indispensable."
Should an injunction occur, it is likely that customers would get a
little time before a shutdown. In a recent court filing arguing for
the injunction, NTP recommended that BlackBerry customers be given a
30-day grace period.
Is there a real workaround?
RIM maintains that the company has tested and readied a legal
technical workaround solution that would let the company continue
offering its mobile e-mail service even if the judge orders an
injunction before the patent office rules.
In an earnings call late last month, RIM Chairman and Co-CEO Jim
Balsillie said the company will reveal details of a workaround "very
soon" that it could ship latent in future products. Balsillie said a
workaround will not violate any of NTP's patents.
Nevertheless, details of this workaround have remained a stubborn
RIM officials say that they have yet to release the details of the
workaround - "for legal reasons," and so as not to tip a hand to NTP
more than necessary. The bottom line is that customers have been left
in the dark.
"Nobody knows," said Alex Kogan, director of network and data center
services at Boston Properties, a real estate company in Boston with a
deployment of 170 BlackBerrys. "NTP is saying there's no solution that
will work without defying the patent. It's kind of a waiting game."
Will the workaround be pain free?
Probably not. RIM's own court filings indicate that implementing a
workaround won't be easy.
"Implementing a workaround requires reloading software on servers and
BlackBerry handheld devices," reads a January 17 court briefing from
RIM's legal team.
"This which would likely involve some significant effort on behalf of
users and their supporting organizations, which will need to take time
to implement the upgrades, and will likely experience typical problems
experienced with undertaking upgrades."
RIM goes on to note that customers could defect to other services
rather than install any workaround, which may still be challenged by
"Injunctions cover all products 'not colorably different' from the
enjoined product," Anderson said. "So, if the workaround is merely to
take an existing BlackBerry and call it a 'RedBerry,' then that
product would be in contempt."
Do I need a contingency plan?
A backup plan certainly wouldn't hurt and it's a good idea to be aware
Clyde Foster, chief operating officer of Intellisync, which makes
server and client-side software that competes with RIM's, said he has
seen an increase in interest in piloting his software largely from
potential customers in financial services and government.
John Halamka, CIO of Harvard Medical School and Caregroup Healthcare
System, a Boston-area hospital group that supports some 800 BlackBerry
devices, has explored alternatives even though he thinks RIM will
"As risk mitigation, I've tested alternatives such as the [Palm] Treo
700, and they just do not work as well as BlackBerry for high volume
e-mail users=97600 e-mails a day for me," said Halamka.
Also, remember that RIM's rivals may not be above scare tactics.
"There have been a lot of companies out there trying to profit from
this," Boston Properties' Kogan said. "A couple of them have contacted
Indeed, on December 9 the Boston Properties IT team received an e-mail
with the subject header "BlackBerry Shutdown at Boston Properties,
The sender: the chief software architect at Mobiliam, a mobile
computing software company that competes with RIM. Boston Properties'
CEO was cc'd on the message.
Kogan, however, said he'll implement a workaround if needed and
long-term will consider defecting from BlackBerry, depending on how
the installation goes.
One IT manager told eWEEK that while he plans to keep supporting
around 700 BlackBerrys on his company's network, he also is rolling
out a separate server from Good Technology and buying around ten Treo
700 devices for the top executives.
In case of a BlackBerry shutdown, these executives will be taken care
of immediately, and an alternate server will be in place for future
Will RIM and NTP make up?
Gartner estimates there's a 35 percent chance the two companies will
settle and a 20 percent chance RIM will enact a workaround.
Nevertheless, RIM and NTP almost made peace in the past. In March
2005, the companies announced a settlement deal worth $450 million,
but the deal fell apart a couple of months later when the companies
failed to agree to terms.
Recently, NTP has proposed various licensing plans in court briefings,
but RIM officials remain publicly confident that the Patent Office
will reject the NTP patents. Still, many customers are banking on the
companies making nice.
"We're confident that there will be a settlement," Kogan said. "RIM
won't shut down for that many customers. It would kill their business
... It will either be ruled in RIM's favor or there will be a
settlement. But if there's an outage, we'll deal with it accordingly."
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