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For hundreds of companies, a court ruling Friday against inventor Jerome Lemelson was akin to the house dropping on the wicked witch in “The Wizard of Oz.” Nevada U.S. District Judge Philip Pro concluded that Lemelson’s estate can’t enforce 14 patents relating to machine vision and bar-code technologies because the prolific inventor and his estate waited too long to pursue the alleged infringers. The so-called “submarine patents” are invalid, Pro ruled, and are not infringed by products made by Symbol Technologies Inc. and Cognex Corp. The decision could end infringement suits that Lemelson’s estate has filed against companies in the electronics, computer, semiconductor and retail industries. It also could dry up a licensing gold mine. Jesse Jenner, a partner at New York’s Fish & Neave who represents Symbol and Cognex, said that in the past 12 years about 1,000 companies “are reported to have paid $1.5 billion” to license Lemelson’s patents. “This is probably the most substantial licensing program of any individual patentee in history,” Jenner said. “It’s now essentially terminated.” Aspen, Colo., attorney Gerald Hosier, the lead attorney for the Lemelson estate, could not be reached for comment. Louis Hoffman, a Scottsdale, Ariz., lawyer who also represents the Lemelson estate, referred questions to Hosier. Although Lemelson died in 1997, the foundation he set up has continued to vigorously enforce his patents, going after the users of machine vision and bar-code equipment. In 1998, Cognex, a manufacturer of machine vision products, and eight manufacturers of bar-code scanners led by Symbol Technologies, went on the offensive. They sought a ruling that Lemelson’s patents are invalid and not infringed by users of their products. Lemelson’s patents are known as “submarine patents” because they were submerged for decades in the U.S. Patent and Trademark Office. Lemelson’s critics say he manipulated the patent system, continuously revising his applications to cover products as they came on the market. Lemelson submitted his original application on machine vision in the 1950s. While his first patent on the technology was issued in 1963, additional patents weren’t granted to him until the 1980s, when the technology was in widespread use. Judge Pro concluded that Lemelson’s 18- to 39-year delay in filing and prosecuting the patent claims was unreasonable and that the patents were therefore unenforceable. “Beyond the extraordinary delay presented here, the record also shows that Lemelson effectively extended his patent monopoly by maintaining co-pendency for nearly 40 years through continuation practice, and added new claims to cover commercial inventions in the market place years after his original patents had expired,” Pro wrote. Judge Pro also found that Symbol and Cognex products do not infringe Lemelson’s patents since they do not work like the technology described in Lemelson’s patents. “Lemelson’s patented system could not be used to read a bar code, nor does the Lemelson common specification reveal any teaching or suggestion of catching information or identifying an article by the decoding of encoded information,” Pro said in Symbol Technologies v. Lemelson Medical, Education & Research Foundation, 01-701. Jenner said five to seven separate complaints that Lemelson filed against hundreds of companies were stayed in Arizona federal court pending the outcome of Symbol. Another suit against a group of semiconductor companies, which involves patents on a semiconductor manufacturing process, was also stayed. As for the companies that have existing licensing agreements with Lemelson, it’s uncertain whether they will have to continue making payments. Jenner said that, depending on the terms, licensees may be able to get out of the deals. Roger Cook, a partner at Townsend and Townsend and Crew who represents Ixys Corp., a defendant in the semiconductor suit, said companies could get their money back if they can prove they were induced into the licensing agreement by fraud. Alternatively, he said, companies paying a running royalty could have specified that they were paying in protest subject to the outcome of litigation. “There may have been some licensees that did that in view of the Cognex litigation,” Cook said. “If they did so, Lemelson would have to pay back royalties since the date of the protest.”

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