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WEEKLY NEWS - JUNE 06, 2008

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This article is part of MIP Week, a weekly email newsletter written by the editors of Managing IP magazine. Take a one week trial to Managing IP and find many more related articles.

Cornell wins $184 million jury award against HP

Eileen McDermott, New York

Hewlett-Packard has been ordered by a jury in the Northern District of New York to pay $184 million to Cornell University for patent infringement

The patent in question (US patent number 4807115 ) relates to former Cornell University professor Hwa C Torng's 1989 invention of a technique for significantly increasing the efficiency and speed of computer processors.

Cornell sued HP in 2001, claiming that the global technology company began infringing on Torng's patent in 1996 by using the patented technology in servers in HP workstations. Torng's patent expired in 2006.

One of Hewlett-Packard's arguments against Cornell's claims of infringement was that Torng's right as patent holder had been exhausted by licences and implied licences that Cornell held with Intel and IBM, since some of the processors in question had been made by the two companies.

However, Cornell's patent counsel, Ed Poplawski of Sidley Austin, said that the jury ultimately concluded that the terms of Intel's licence did not apply to HP's activities and that there was no evidence of an implied licence between the university and IBM.

The issue of patent exhaustion is being hotly debated among the patent community, with a Supreme Court decision expected this month in the landmark case, Quanta v LG , which was argued in January this year and could affect the right of patent owners to place restrictions on patent licensees.

In a statement sent to Managing IP about the verdict, HP said: "We respect the jury's decision, though we don't agree with it. HP respects the intellectual property rights of other companies and organizations around the world, and likewise protects and enforces its own intellectual property rights. HP and Cornell have maintained a strong relationship over the years, and we look forward to renewing that strong relationship."

Poplawski said that the almost seven-year trial was "difficult for Cornell" and that Hewlett-Packard made the discovery process "especially challenging".

Although Hewlett-Packard is likely to appeal, the case will first move to post-trial motions on laches and other issues. No timeline has yet been set.



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