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Otis Wins Schindler Fight Over World Trade Center Elevator

United Technologies Corp. (UTX)’s Otis Elevator unit won a U.S. appeals-court ruling that invalidates a patent owned by Schindler Holding AG (SCHP), in a dispute over technology used in elevators at New York’s 7 World Trade Center.

The U.S. Court of Appeals for the Federal Circuit today said the patent owned by Schindler’s Inventio unit is invalid as an obvious variation of earlier know-how. A July 2011 jury verdict that upheld the patent “lacks substantial evidentiary support,” the court said today in a decision posted on its website.

The patent covers the use of magnetic cards or similar identifying transmitters to direct a person to a specific elevator that will go to a pre-designated floor without having to use buttons. Inventio filed suit Nov. 6 against Thyssenkrupp Elevator Corp., claiming elevators at 1 World Trade Center and 11 Times Square infringe the same patent.

Otis’s system is installed at 7 World Trade Center, built by New York developer Larry Silverstein to replace a tower destroyed in the Sept. 11 terrorist attacks. The Otis elevator system, called Compass, uses pre-programmed radio frequency identification chips and was the first of its kind installed in the U.S.

“Otis is pleased that the Federal Circuit’s ruling confirms Otis’s long-held position that it is entitled to sell elevators that include Compass destination dispatch with seamless entry,” Thomas Downie, an Otis spokesman, said.

Officials with Hergiswil, Switzerland-based Schindler couldn’t be reached for comment after the close of regular business hours in Switzerland.

Invalid Patent

The trial judge threw out most of Inventio’s case on damages and refused to order a broad ban on the use of the Inventio patent. The Federal Circuit declined to address Inventio’s appeal of those issues because it found the patent invalid.

Inventio sued Otis in 2006, part of a broader dispute over elevators used in high-rise buildings. Schindler is challenging an Otis elevator patent in a case pending in federal court in Newark, New Jersey.

The case is Schindler Elevator Corp. v. Otis Elevator Co., 2011-1615 and 2012-1108, U.S. Court of Appeals for the Federal Circuit (Washington). The lower court case is Schindler Elevator Corp. v. Otis Elevator Co., 06cv5377, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Susan Decker in Washington at sdecker1@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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