Xref: utzoo comp.sys.mac:16170 comp.sys.ibm.pc:15689 Path: utzoo!attcan!uunet!portal!cup.portal.com!Eric_Shockwave-Rider_Larson From: Eric_Shockwave-Rider_Larson@cup.portal.com Newsgroups: comp.sys.mac,comp.sys.ibm.pc Subject: Re: The Lawsuit, Standardization, and Whiny DOS Users... Message-ID: <5558@cup.portal.com> Date: 17 May 88 22:23:00 GMT References: <8685@eleazar.Dartmouth.EDU> <5823@well.UUCP> <10600@steinmetz.ge.com> <5836@well.UUCP> <1252@uokmax.UUCP> <5884@well.UUCP> <5167@cup.portal.com> <488@bnlux0.bnl.gov> <5507@cup.portal.com> Organization: The Portal System (TM) Lines: 76 XPortal-User-Id: 1.1001.4308 Further support for "tortured" logic..... Wall Street Journal, Tuesday, May 17, 1988 Paul B. Carroll New York - International Business Machines is demanding retroactive payments for patents it says companies have used in selling IBM compatable personal computers over the past several years. The move has shocked the clone makers which had assumed that IBM's lack of objection had assured them of clear sailing, and could squeeze the more marginal clone companies. The decision could also delay the introduction of some clones of IBM's PS/2 line of personal computers. In addition, the move reintroduces the prospect of messy litigation in the personal computer market at a time when IBM's decision to license the patents for its PS/2 line had been quieting that talk. "IBM is saying, in effect, "Sure, we'll let you license our PS/2 patents, but let's make sure that we're all squared away on what you owe us for patents on the original PC, XT and AT.' " said one industry executive, who asked not to be identified. For many companies, that would involve payments of at least 1% of sales back to 1982 or 1983, in a business in which manufacturers profit margins total just a few percentage points. Clone makers have sold billions of dollars of these products, and it would be hard to say how much money would be involved in retroactive patent payments on them; IBM declined to estimate how much it could recieve from such payments. IBM, in confirming statements from industry executives about the patent payments, said clone companies shouldn't have been surprised. The Armonk NY office equipment maker has made no secret of its intention to protect it's computer patents. An IBM spokesman said the company would accept payments totalling 1% of sales for sales made through last April 1, assuming the clone companies settle up with IBM by year end. If a settlement isn't reached this year, the spokeman said, IBM could raise the rate. IBM also said that sales made after April 1 would be subject to the 5% maximum royalty that IBM recently said will apply to PS/2 patents. The spokesman said IBM would sue, if necessary, to protect it's patent rights. It wasn't immediately clear just how many companies would be affected by IBM's decision, but the effect is likely to be broad. In the rush to get clones into the marketplace, many companies proceeded without checking to be sure that they steered clear of IBM's patents. Big clone makers, however, are much less likely to be affected than the smaller ones, because they have patents that IBM uses and thus have cross licensing agreements that limit any payments they owe IBM. Patent lawyers also say that, in any case, clone makers would be able to invoke a legal principle called laches. In effect, that means that clone makers can say that they have managed their business on the assumption that because IBM hadn't challenged them by now it wasn't going to challenge them. The lawyers say that IBM would probably still be able to insist on some sort of payment, though IBM might have to mitigate it's demands. ----- Fear, Uncertainty, and Doubt. or, Welcome to Rancho IBM. :-) :-) :-) :-)