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For hundreds of companies, a court ruling Friday against inventorJerome Lemelson was akin to the house dropping on the wicked witch in “The Wizardof Oz.” Nevada U.S. District Judge Philip Pro concluded that Lemelson’sestate can’t enforce 14 patents relating to machine vision and bar-codetechnologies because the prolific inventor and his estate waited too long topursue the alleged infringers. The so-called “submarine patents” are invalid, Pro ruled, and arenot infringed by products made by Symbol Technologies Inc. and Cognex Corp. The decision could end infringement suits that Lemelson’s estatehas filed against companies in the electronics, computer, semiconductor andretail industries. It also could dry up a licensing gold mine. Jesse Jenner, a partner at New York’s Fish & Neave whorepresents Symbol and Cognex, said that in the past 12 years about 1,000companies “are reported to have paid $1.5 billion” to license Lemelson’spatents. “This is probably the most substantial licensing program of anyindividual patentee in history,” Jenner said. “It’s now essentially terminated.” Aspen, Colo., attorney Gerald Hosier, the lead attorney for theLemelson estate, could not be reached for comment. Louis Hoffman, a Scottsdale,Ariz., lawyer who also represents the Lemelson estate, referred questions toHosier. Although Lemelson died in 1997, the foundation he set up hascontinued to vigorously enforce his patents, going after the users of machine visionand bar-code equipment. In 1998, Cognex, a manufacturer of machine visionproducts, and eight manufacturers of bar-code scanners led by SymbolTechnologies, went on the offensive. They sought a ruling that Lemelson’spatents are invalid and not infringed by users of their products. Lemelson’s patents are known as “submarine patents” because theywere submerged for decades in the U.S. Patent and Trademark Office. Lemelson’scritics say he manipulated the patent system, continuously revising hisapplications to cover products as they came on the market. Lemelson submitted his original application on machine vision inthe 1950s. While his first patent on the technology was issued in 1963,additional patents weren’t granted to him until the 1980s, when the technologywas in widespread use. Pro concluded that Lemelson’s 18- to 39-year delay infiling and prosecuting the patent claims was unreasonable and that the patentswere therefore unenforceable. “Beyond the extraordinary delay presented here, the record alsoshows that Lemelson effectively extended his patent monopoly by maintainingco-pendency for nearly 40 years through continuation practice, and added newclaims to cover commercial inventions in the market place years after hisoriginal patents had expired,” Pro wrote. Pro also found that Symbol and Cognex products do notinfringe Lemelson’s patents since they do not work like the technologydescribed 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 ofcatching information or identifying an article by the decoding of encodedinformation,” Pro said in Symbol Technologies v. Lemelson Medical, Education& Research Foundation, 01-701. Jenner said five to seven separate complaints that Lemelson filedagainst hundreds of companies were stayed in Arizona federal court pending theoutcome of Symbol. Another suit against a group of semiconductorcompanies, which involves patents on a semiconductor manufacturing process, wasalso stayed. As for the companies that have existing licensing agreements withLemelson, 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 ofthe deals. Roger Cook, a partner at Townsend and Townsend and Crew whorepresents Ixys Corp., a defendant in the semiconductor suit, said companiescould get their money back if they can prove they were induced into thelicensing agreement by fraud. Alternatively, he said, companies paying arunning royalty could have specified that they were paying in protest subjectto the outcome of litigation. “There may have been some licensees that did that in view of theCognex litigation,” Cook said. “If they did so, Lemelson would have to pay backroyalties since the date of the protest.”

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