EVERETT – Intermec Technologies Corp., which won a string of settlements to protect its smart battery patents over the past decade, is now defending its radio frequency identification technology.
The locally based division of Everett’s Unova Inc. filed a lawsuit in June against Matrics Inc. of Rockville, Md. The claim alleges Matrics’ RFID products and systems use technology covered by four patents owned by Intermec, and it asks for a “reasonable” royalty.
Radio frequency identification tags, which consist of a microchip and tiny antenna, can store information that’s read by special scanning devices.
Though the technology has roots back to World War II, it’s just now getting serious interest from companies such as Wal-Mart. The giant retailer sees potential benefits and cost savings in using RFID tags to keep track of inventory.
Intermec President Tom Miller said a number of companies that have focused on RFID in recent years asserted that the intellectual property underlying the technology was free.
“That flies in the face of any other industry or technology,” he said.
Intermec holds more than 130 patents related to RFID. The company itself was a pioneer in the field and gained more patents through acquisitions in the 1990s. Its patents cover the core technology used in RFID tags and scanning devices.
The company’s lawsuit doesn’t ask for an injunction to keep Matrics, which is in the middle of being bought by Symbol Technologies, from selling products that use the allegedly patented technology.
“We did not stop them,” Miller said. “We want to bring them into a licensing agreement.”
Intermec last year began offering a standard licensing agreement that allows others to use any of Intermec’s RFID patents for a fee. Since the lawsuit was filed, a number of companies have begun licensing discussions with Intermec, Miller said.
“We feel it’s a balanced position,” he said. “We feel it will benefit the technology and users while protecting our patent position.”
Intermec and Unova know something about protecting patents. By protecting its smart battery technology, which is widely used in laptop computers, Intermec ended up settling intellectual property cases and winning more than $115 million in royalties over the past decade from nearly a dozen computer makers, including Sony, Apple and Gateway.
Intermec’s the first to press major patent claims in the emerging RFID industry, however. And the action comes as the company and others in the industry have been hammering out a standard for the next generation of RFID products.
The group leading that process, EPCglobal Inc., has said it will have to evaluate intellectual property issues as the standard is further developed.
Miller said the proposed standard for the new generation of RFID would require the licensing of nine Intermec patents. He added that Intermec, which has long been involved in the standard-setting process, has donated rights to five other patents toward the new standard.
Jeff Woods, an RFID analyst with Gartner Inc., said he thinks Intermec’s new lawsuit may make some companies more wary of EPCglobal’s standard-setting process. However, he said it shouldn’t affect the spreading use of RFID technology.
“In the long term, we always expected people would have to pay royalties,” Woods said. “We didn’t expect a royalty-free standard, so our advice to our clients on this technology hasn’t changed.”
Erik Michielsen, director of RFID analysis at ABI Research Inc. in New York, added that Intermec’s lawsuit has caused “some friction” in the industry, but he thinks it will amount to a bump in the road.
“It will work its way out. It may have an effect on companies’ budgets … but all technologies have dealt with this before.”
Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.
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