The maker of the BlackBerry on Monday suffered a setback in a patent dispute that could shut down the hugely popular wireless e-mail service in the US.
The US Supreme Court refused to hear an appeal from Research in Motion over a lower court ruling that said it was infringing patents of Virginia-based NTP. The case dates back to 2002, when NTP successfully sued RIM. It won an injunction a year later to halt US sales of the BlackBerry and to shut down the service, although the ruling was stayed pending appeal.
Some 70 percent of RIM's revenue comes from the US and the business closure would be a blow. It would be just as shocking to the millions of users of the hand-held devices.
The appeals court scaled back the initial ruling but still said RIM had infringed on NTP patents. The two sides reached a US$450m settlement in March, but the deal fell apart three months later. RIM has asked the appeals court to enforce the deal. NTP has asked the court to press ahead with a permanent injunction, royalty payments and US$126m in damages.
RIM, which is based in Waterloo, Ontario, had asked the Supreme Court to consider whether it was wrong to apply US patent rules when its main computers that handle the e-mails are based in Canada. NTP said the supreme court decision had "closed the final path for RIM to avoid liability for the infringement" and cleared the way for a lower court to issue the injunction.
RIM played down the significance of the failed appeal. Mark Guibert, RIM's vice president of corporate marketing said the supreme court decision had "no bearing on the merits of the outstanding issues" still pending in the Richmond, Virginia courtroom.
RIM has been preparing contingency plans. The firm has been working to develop new technologies to support its system that don't infringe the NTP patents.