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From: tnixon@hayes.uucp
Newsgroups: comp.dcom.modems
Subject: Re: Hayes Microcomputer lawsuit???
Message-ID: <3759.27a62207@hayes.uucp>
Date: 30 Jan 91 01:31:51 GMT
References: <1510@public.BTR.COM>
Organization: Hayes Microcomputer Products, Norcross, GA
Lines: 55

In article <1510@public.BTR.COM>, cec@public.BTR.COM (Cerafin E.
Castillo  cec@btr.com) writes: 

> I recently heard that Hayes Microcomputer was in the midst of a lawsuit
> in regards to technology it (Hayes) develops, sells, or licenses.  I did
> not catch any specifics since it was mentioned on a stock market report
> and technical or company comments were not made known.
> 
> Can anyone enlighten me on this issue?  Toby, what is the company line?

Briefly, Hayes, like many modem companies (including Telebit), holds
a number of patents related to modem technology we invented.  Other 
companies who wish to incorporate this technology into their 
products must license the associated patent from Hayes.  One such 
patent is the Heatherington '302 patent, "Modem with Improved Escape 
Sequence", which relates to the guard time associated with the "+++" 
escape sequence used to change the modem from online to command 
state.  Many modem companies have licensed this patent from Hayes, 
since it is considered to be an essential feature of modems which 
can truthfully claim to be "Hayes compatible".

The case you've heard about recently involves a patent infringement 
suit filed a number of years ago by Hayes against four companies 
which, despite being information by Hayes that their products 
infringed the patent, refused to obtain licenses and pay royalties.  
In fact, some of these companies sued Hayes FIRST, saying we were 
attempting to monopolize the modem market (a ridiculous contention, 
and their suit was thrown out by summary judgement a while back).  
This suit came to trial in early January.  One of the four 
companies, Prometheus, settled and licensed the patent the day 
before the trail started.

Last Friday, the jury returned their verdict, finding that the 
patent is valid, and that the remaining three companies (Everex, 
Omnitel, and Ventel) had willfully infringed it.  The total damages 
awarded to Hayes by the jury was $3.5 million, to which will be 
added interest.  Also, because of the finding of willful 
infringement, the judge may decide to treble the damages, and also 
award attorneys fees and other litigation costs.  There is also the 
possibility that the infringers will be enjoined (prevented) from 
manufacturing any more products that infringe the patent, until they 
obtain licenses (which Hayes is under no legal obligation to grant).

I really can't comment further than this, because there is still the
potential that the defendants will appeal, so the matter is still
technically in litigation. 

Hayes also has a suit pending against Multitech for infringing the 
same patent.

-- 
Toby Nixon, Principal Engineer    | Voice   +1-404-449-8791  Telex 151243420
Hayes Microcomputer Products Inc. | Fax     +1-404-447-0178  CIS   70271,404
P.O. Box 105203                   | UUCP uunet!hayes!tnixon  AT&T    !tnixon
Atlanta, Georgia  30348  USA      | Internet       hayes!tnixon@uunet.uu.net