Lemelson loses patent ruling: some machine vision patents ruled invalid.

NATICK, MA -- In a ruling whose implications could be felt across many industries, a federal court has ruled in favor of a plaintiff who claimed that more than a dozen patents owned by the Lemelson Partnership are invalid and unenforceable. An attorney for the Lemelson Partnership said it would appeal the ruling.

On Jan. 23, the U.S. District Court in Las Vegas issued a ruling in favor of Symbol Technologies, Cognex Corp. and Telxon Corp. in their lawsuit against the Lemelson Partnership, which oversees several patents of the late U.S. inventor Jerome Lemelson. In a landmark decision, Chief Judge Philip Pro held that the claims of 14 patents asserted by the Lemelson Partnership are invalid and unenforceable, and not infringed by Cognex. (Read the entire ruling at cognex.com/pdf/corporate/Lemelson_decision.pdf.)

Lemelson was an inventor who patented hundreds of ideas, few of which he ever actually built. Instead, Lemelson--and his team of attorneys--vigorously pursued firms whom they felt were infringing on his works, suing them for licensing fees and royalties. He died in 1997.

Although many of his patents were assigned in the 1950s and 1960s and would have expired years ago, Lemelson was able to extend their life by repeatedly filing extensions and amendments to the original claims. In the suit, it was noted that some of Lemelson's claims for machine reader technology do not expire until 2011,55 years after the original filing and 48 years after the patent was issued. By law, U.S. patents are protected for 17 years after the date of issue.

In 2000, the Lemelson Partnership sued over 400 users of bar code readers and machine scanners. Many settled, including Home Depot, the world's second larger retailer.

Over the years, Lemelson was assigned at least 18 U.S. patents for machine vision technology. Cognex, however, said that many of said patents are "direct descendents of filings made in 1954 and 1956." In a press statement, the plaintiffs noted Lemelson "never built or sold a single vision system or bar code reader" but have used the threat of patent litigation suits to collect more than $1.5 billion in licensing fees from users of the machines. Cognex called Lemelson's actions "legalized extortion."

As a result of the ruling, every company will be able to use machine vision systems and bar code readers, anywhere in their operations, without the threat of litigation from the Lemelson Partnership, and without having to pay licensing fees.

Dr. Robert J. Shillman, chairman and CEO of Cognex, said, "We pursued this litigation because we knew that what Lemelson and his Partnership were doing was terribly wrong."

Cognex spent "millions of dollars" fighting the suit, Shillman said. It filed the original suit in Massachusetts in September 1998, and refiled in Nevada in September 1999 after a judge ruled Massachusetts was the wrong jurisdiction to hear the case because Lemelson lacked a sufficient business connection there. A Nevada judge later combined Cognex's suit with that of Symbol and seven other bar-code scanning equipment makers. Symbol and Texlon have since merged.