Sept. 4 (Bloomberg) -- Toyota Motor Corp., the world’s biggest seller of autos powered by a combination of gasoline and electricity, faces a patent-infringement claim that may result in a U.S. import ban on its Prius and other hybrid models.

Closely held Paice LLC filed a complaint yesterday with the U.S. International Trade Commission in Washington, claiming Toyota is infringing its patent. The company seeks an order to ban imports of Toyota products using its invention.

Paice won a jury verdict in 2005 that the Prius and hybrid Highlander and Lexus RX400h sport-utility vehicles used Paice inventions related to drivetrains. The new ITC complaint claims the hybrid Camry, third-generation Prius, Lexus HS250h sedan and Lexus RX450h SUV infringe the same patent.

“Given the momentum Toyota hybrids have in the marketplace, I don’t foresee a situation where their hybrid sales stop,” said Ed Kim, an analyst at AutoPacific Inc. in Tustin, California. “Toyota has been pretty good about looking ahead, so it would be surprising if they hadn’t foreseen and prepared for something like this.”

In the complaint, Paice said Toyota is precluded from arguing that the additional vehicles don’t infringe the patent or challenging its validity because of the 2005 verdict, which was upheld on appeal. The hybrid drivetrains of the vehicles in the ITC case “are materially the same” as those in the Lexus and Toyota models in the civil case, Paice said in the complaint.

That same patent will be at the center of another trial set to begin Oct. 1 in federal court in Marshall, Texas, involving the Camry. Paice claims the hybrid sedan infringes two other patents. A second case pending in Marshall involves claims of infringement of another patent by the Highlander and Lexus models.

Exclusion Order

The commission in Washington is set up to protect U.S. market from unfair trade practices, including patent infringement. If it agrees to investigate Paice’s claims, the investigation could be completed in about 15 months. It has the power to order U.S. Customs and Border Protection officials to block infringing products from entering the country.

Unlike a civil court, the ITC doesn’t have the power to order Toyota to pay royalties, and the only remedy possible if a violation is found is an exclusion order. Toyota spokesman Hideaki Homma declined to comment on the case.

To be able to win at the ITC, Paice must show that it has a market to protect. In the complaint, Paice says it has made “substantial investments” in vendors and suppliers and in research and licensing.

The company is based in Bonita Springs, Florida, and has offices in Maryland, Michigan and Virginia, according to the complaint. Company officials didn’t immediately return calls.

Patent Owners

The ITC, in an unrelated case, is currently considering the standard that must be met before patent owners who don’t make products can file complaints.

Toyota closed unchanged at 3,850 yen in Tokyo.

In the earlier case, the jury awarded $4.3 million in damages and the verdict was upheld on appeal. U.S. District Judge David Folsom in Marshall rejected Paice’s request to issue a court order to halt sales of the Toyota vehicles.

Instead, in April he ordered Toyota to pay royalties based on the wholesale prices equal to 0.48 percent for a second- generation Prius, 0.32 percent for each Highlander and 0.26 percent for each Lexus RX400h. Toyota is appealing that order.

1.1 Million Sold

Since 2000, when Toyota introduced the Prius in the U.S., the company has sold 1.1 million hybrids in the market, including more than 750,000 units of Prius.

Toyota created the market for hybrid vehicles when it introduced the Prius in Japan in 1997. The company has set a goal of selling a million gasoline-electric vehicles annually beginning in the early 2010s.

The third-generation Prius, which went on sale in May, gets an average of 50 miles per gallon in combined city and highway driving, making it the most fuel-efficient gasoline-engine vehicle sold in the U.S., according to the Environmental Protection Agency.

This isn’t the first ITC case Toyota has fought over its hybrid motors. Solomon Technologies Inc. of Tarpon Springs, Florida, lost a case in which it claimed its technology for transmission drives was used in Toyota Prius, Highlander, Camry and Lexus vehicles. An appeals court last year upheld the ITC’s decision.

Solomon has a pending civil suit against Toyota in federal court in Tampa, Florida, that Toyota is trying to get thrown out by arguing the issued was resolved by the ITC.

Rollover Cases

Toyota also may face demands that rollover-crash cases it won or settled be reopened, in light of accusations by a former company lawyer that the company hid records sought by plaintiffs.

The ex-Toyota lawyer, Dimitrios Biller, sued the company in July, claiming the world’s largest automaker and its U.S. units destroyed engineering and testing evidence relevant in more than 300 suits over sport-utility vehicle rollover accidents. Biller managed the electronic document-discovery program for Toyota, he said in court papers.

The ITC case is In the Mater of Hybrid Electric Vehicles, 337-2680, U.S. International Trade Commission (Washington). The civil cases are Paice LLC v. Toyota Motor Corp., 04- cv-211; 07cv180 and 08-cv-261, U.S. District Court, Eastern District of Texas (Marshall).

To contact the reporters on this story: Susan Decker in Washington at sdecker1@bloomberg.net; Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net.

Last Updated: September 4, 2009 02:44 EDT