News Business

Long-running ClearOne IP case set to go to appeal

test 5 May 2009

US: A final judgement in favour of ClearOne Communications was announced late last month, writes David Davies. The lengthy dispute revolves around ClearOne’s claim that WideBand Solutions had misappropriated its intellectual property. Biamp Systems says that it was named as a co-defendant on the basis of a licence agreement with WideBand Solutions.

The final judgement issued by the United States District Court of Central Utah in Salt Lake City on April 20 follows hot on the heels of a permanent injunction granted on April 9 which prohibits WideBand Solutions from any use of the relevant intellectual property, including the AEC-2W algorithm previously licensed to Biamp Systems.

Shortly after the judgement was handed down, ClearOne posted a statement on its website revealing that it intends to "vigorously pursue" collection of the cited $9.7 million (approximate) in damages, whilst acknowledging that "collectability of the judgments cannot be guaranteed".

Zee Hakimoglu, president and CEO of ClearOne, tells PSN-e: _In October and November of 2008, ClearOne_s concerns were presented to a federal jury, selected by all the parties and the court. The jury spent twelve days listening to all sides, and after careful deliberation found all defendants guilty of not only theft of ClearOne_s trade secrets, but that the defendants did so willfully and maliciously. The Chief Judge of the United States District Court specifically affirmed this finding, in a detailed written opinion, and she then awarded exemplary damages based upon the willful nature of the theft. As we said at trial, ClearOne believes in competition, but we also believe it needs to be fair and honest. This verdict affirmed this fundamental principle._

Now, in a development that is likely to ensure the dispute continues for many months to come, both WideBand Solutions and Biamp have indicated their intention to appeal against the ruling.

"ClearOne does have a verdict, judgement and an injunction preventing WideBand from using something (Honeybee code) WideBand doesn’t use and never has used – for whatever that’s worth," says Don Bowers, WideBand’s regional manager, in a statement issued to PSN-e. Confirming the company’s determination to fight on, Bowers adds that WideBand "will appeal and will have this verdict thrown out and reversed".

Meanwhile, Biamp says that it never possessed or had access to the source code for the AEC-2W algorithm, and ceased using it in 2006. Biamp also insists that, as of the same year, all Biamp products have contained the company’s own, internally-developed code.

Biamp insists that its current products, services and technologies are "unaffected" by the decision, and on April 22 announced that it will file an appeal.

"For Biamp Systems, there is a huge sense of relief that the court has issued a final judgement as we are anxious to get this case out of Salt Lake City and into appeals," says Ralph Lockhart (pictured), president of Biamp Systems. "With a new venue in appeals court, we will have an objective, unencumbered view of this case. We had absolutely no knowledge of any misappropriation, and we feel this judgement was not supported by the evidence. We are confident a higher court will agree with us."


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