Forgent Networks ceases JPEG patent battle

By Matt Whipp

Posted on 3 Nov 2006 at 12:59

Forgent Networks has ceased pressing patent claims against the JPEG standard for image formats.

Forgent has agreed to drop all pending cases and not to file any further suits based on the US Patent No. 4,698,672 (the '672 Patent).

Earlier this year the Public Patent Foundation (PUBPAT) had the patent re-examined by the US Patents and Trademark Office (USPTO) after it submitted the earlier Tescher 4,541,012 patent as 'prior art'.

In an SEC filing, Forgent records further bad news: in June a court issued 'an unfavourable claims construction ruling, which favoured the majority of the defendants' claims construction'.

This limited Forgent's '672 claims to video only.

Having already settled its litigation with 15 of the defendants, Forgent set about tying up the remaining cases. Its limited claims meant that the final licences agreed amounted to a total of $8m.

Previous litigation of the '672 patent had earned the company in excess of $100m.

Financial and other details around the decision to drop the claims entirely have not been disclosed.

'We are satisfied with the resolution of this matter. Over the life of the '672 patent, we have collected in excess of $110M. Our focus now shifts to the November '746 patent claims construction hearing and the May 2007 jury trial and continuing to grow our NetSimplicity software business,' said Richard Snyder, chairman and CEO of Forgent.

Companies that have felt the long arm of Forgent's litigation in the past include Apple, IBM, HP and Dell, as well as Jasc for its Paint Shop Pro application.

'By completely ending its assertion of the '672 patent, Forgent has now finally admitted that the patent has no valid claim over the JPEG standard,' said Dan Ravicher, PUBPAT's Executive Director. 'This utter capitulation by Forgent is long overdue, but a cause for public relief nonetheless.'

Andrew Katz, partner at Moorcrofts LLP told us: 'It seems that although Pubpat "successfully initiated a challenge", this did not lead to a declaration that the patent was invalid, but just enabled them to reach a settlement with Forgent that they would not assert going forward. In that case, the patent still stands, and it is unlikely that there would be any opportunity to recoup past payments.'

Forgent Networks acquired the '672 patent when it bought out Compression Labs in 1997.