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Kodak Suffers Setback in Patent Dispute with RIM and Apple

Strategic Insights

— 2 min read

Eastman Kodak Co. saw its shares fall by as much as 8.6 percent in late trading on Monday after a U.S. trade agency ruled that Apple's iPhone and Research In Motion's (RIM) BlackBerry device do not infringe on Kodak's patent for a common image-preview feature used in phones. The administrative law judge's findings are subject to review by the six-member U.S. International Trade Commission, which has the power to block imports of products that infringe U.S. patents. Kodak has been trying to drum up royalties from its over 1,000 digital-imaging patents to fund a shift to more modern devices.

Key Takeaways:

  • The U.S. trade agency ruled that Apple's iPhone and RIM's BlackBerry device do not infringe on Kodak's patent for a common image-preview feature used in phones.
  • The image-preview feature is used in every digital camera and phone with a camera, but Kodak's patent was deemed invalid by the administrative law judge because it is an obvious variation of an earlier invention.
  • Kodak shares fell by as much as 8.6 percent in late trading on Monday after the ruling.
  • kodak was trying to use the trade commission to reach agreements with phone makers and generate $250-350 million in revenue from its intellectual property each year.
  • The U.S. Patent and Trademark Office initially affirmed the validity of the patent, but at the request of RIM and LG, it took a second look and decided to issue a notice confirming the validity of the patent.
  • The case is subject to review by the six-member U.S. International Trade Commission, which has the power to block imports of products that infringe U.S. patents.
  • Apple has filed a patent-infringement complaint against Kodak and RIM has a civil lawsuit in federal court challenging the validity of Kodak's patents.

Statistics:

  • Kodak's shares fell by as much as 8.6 percent in late trading on Monday.
  • Kodak has over 1,000 digital-imaging patents that it has been trying to license to other companies.
  • Kodak expects to generate $250-350 million in revenue from its intellectual property each year.
  • The U.S. Patent and Trademark Office initially affirmed the validity of the patent, but at the request of RIM and LG, it took a second look and decided to issue a notice confirming the validity of the patent.

Sources:

  • Bloomberg News
  • Eastman Kodak Co.
  • Research In Motion Ltd.
  • Apple Inc.
  • U.S. International Trade Commission
  • Waterloo Region Record

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