Research In Motion’s attempt to enforce a $450-million-US settlement deal with NTP Inc. was denied Wednesday by U.S. judge, who will now proceed to consider whether to block sales of the BlackBerry.
U.S. District Judge James R. Spencer’s decision is a victory for NTP Inc., an Virgina-based patent company that maintains the technology behind the popular BlackBerry wireless e-mail products infringes on its patents.
The Waterloo, Ont.-based company had sought to uphold an agreement reached earlier this year that NTP, a U.S. patent royalty company, said was never finalized.
Spencer said the “court finds the parties do not have a valid and enforceable settlement agreement. He also said he’d schedule further hearings to consider the remaining issues between the parties.
There has also been concern that BlackBerry service, which is used widely in the U.S. public sector including its military, homeland security, police and fire services, could be disrupted if the injunction is granted.
However, analysts and industry observers expect that, instead, RIM will eventually be forced to negotiate a sum as high as $1 billion US to settle the dispute.
Flushed with cash from earlier financings and strong profits, the Canadian company could well afford to pay such an amount but has waged a protracted legal battle in the U.S. courts and at the U.S. patent office, which has conducted a separate review of the matter.
The stakes are huge for RIM, one of Canada’s leading high-technology companies thanks to the market success of the BlackBerry in the United States and around the world.
The company has the bulk of its workforce in the southwestern Ontario city of Waterloo but has announced plans to spend $230 million over five years to set up a technical support centre in Nova Scotia, bringing 1,250 jobs to the city of Halifax