University Files Patent Infringement Suit Over Bluetooth Technology

Posted on January 3, 2007

The University of Washington has filed suit against three major electronics makers alleging that the companies are illegaly placing unlicensed Bluetooth chip sets in products ranging from cell phones, computers and headsets. The university is asking for an injunction to stop all sales of the chips as well as unspecified damages.

Matsushita, known globally for its Panasonic brand products, and Samsung produce a wide range of electronics products, while Nokia is the world's largest manufacturer of cellular telephones. Bluetooth, whose products feature a distinctive, blinking blue light, enables wireless exchanges of data between cell phones, computers, headsets and other devices.
The lawsuit was filed late last month in U.S. District Court in Seattle by the Washington Research Foundation, a nonprofit group that seeks commercial uses and enforces patents for technology developed at Washington's universities and nonprofit research institutions. Analysts said Wednesday that consumers likely won't be affected by the legal wrangling. Defendants would be quick to settle if it appeared the case was immediately threatening their product lines, said Rob Enderle, principal analyst with the Enderle Group.
But Enderle said Broadcom Corp. of Irvine, Calif., the only chip manufacturer that has licensed the technology, stood to profit mightily until the dispute is resolved. "This is like a blazing advertisement for Broadcom," he said. "As long as this is in play, they can say, 'If you want to do Bluetooth products without problems, we're the only guys you can license it from.' This is a huge potential competitive advantage."
He also said timing was fortuitous, coming just ahead of next week's International Consumer Electronics Show, when many buyers and sellers are making design decisions about future products. Nokia officials, following long-standing policy, would not comment on the lawsuit early Wednesday. A Samsung representative acknowledged that the lawsuit had been filed but would not comment further. No one answered a telephone call to Matsushita after business hours.
According to the lawsuit, Bluetooth-based computers, cell phones and headsets made by the companies have violated four patents for research done in the mid-1990s by Edwin Suominen when he was a student at the University of Washington. All four patents are now licensed by the Washington Research Foundation. The foundation's lead counsel on the case, Steven Lisa, said the court filing followed two years of informal attempts to resolve the issue with the major players in the industry. "They've had notice of the patent, they've had an opportunity to discuss the matter with us, and we haven't been able to resolve it," Lisa said. "And nobody has presented, for us to consider, a non-infringement or invalidity argument."

It's a rather surprising case, considering the fact that the three major companies have not argued that they have not infringed the patent, nor have they tried to argue that the university's patents are not valid. Sounds to me like they need to pay up. Watch for this one to settle quietly, especially after the press from the lawsuit hits the International Consumer Electronics Show.