Victoria’s Secret, Delta Caught in Translators’ Dispute

MotionPoint Corp., a maker of technology that translates business websites into foreign languages for customers such as Victoria’s Secret Stores LLC and Delta Air Lines Inc. (DAL), asked a judge not to block sales of its core product in a patent lawsuit brought by a rival.

A federal jury in Oakland, California, found in July that closely held MotionPoint, whose customers also include the U.S. Centers for Disease Control, directly infringed a patent held by TransPerfect Global Inc. and should pay $1 million in damages. New York-based TransPerfect, whose customers include Home Depot Inc. (HD) and American Airlines Inc., is seeking a permanent injunction barring the sale or use of MotionPoint technology that directly or indirectly infringes the patent.

MotionPoint, which provides translation services for more than 1,800 web sites, said in a court filing that a broad injunction could potentially deny millions of foreign language speakers access to translated versions of its customers’ websites.

“I would not enjoin your entire system,” U.S. District Judge Claudia Wilken said at a hearing today. “What I would enjoin is the infringing portion. I think it is the kind of case that would involve an injunction.”

Wilken ordered both companies to file arguments about what an injunction should include and enter mediation to try to settle the dispute. She didn’t rule on whether to grant an injunction.

Head-to-Head

The two companies have competed head-to-head for customers, with closely held TransPerfect losing clients to MotionPoint and at times lowering its prices as much as 20 percent to compete, Michael Eisenberg, TransPerfect’s lawyer, said in a court filing.

“TransPerfect would risk losing potential new customers for its entire range of products and services, which is a recognized harm found to support an injunction,’ Eisenberg said in the filing.

If an injunction isn’t granted, TransPerfect may seek a running royalty rate of more than 4 percent of sales of infringing technologies, he said.

‘‘We are not seeking an injunction of what they are not infringing,” Douglas Lumish, an attorney for TransPerfect, said during the hearing. “We would be happy to negotiate it with them.”

Foreign Language

An injunction targeting MotionPoint services on customer websites would “deny hundreds of thousands, if not millions, of foreign language speakers access to translated versions of websites,” Matt Robson, MotionPoint’s attorney, said in a court filing.

“The harm to the public that would result from TransPerfect’s overreaching injunction is simply not warranted on the facts of this case,” Robson said in the filing.

“While we want the infringement to stop, I don’t forsee something where all of a sudden tons of customer websites come down with no period to cure” the infringement, Phil Shawe, a founder and chief executive officer of TransPerfect, said in a phone interview.

The jury found that TransPerfect didn’t prove that Coconut Creek, Florida-based MotionPoint induced others to infringe the patent. The jury found that only the MotionPoint product used to translate its own website infringed TransPerfect’s patent and MotionPoint has already implemented a non-infringing alternative on its website, Robson said.

“MotionPoint will diligently pursue all of its post-trial rights, including appeal, at the appropriate time,” MotionPoint said in a statement yesterday.

The case is TransPerfect Global Inc. v. MotionPoint Corp., 10-cv-02950, U.S. District Court, Northern District of California (Oakland).

To contact the reporter on this story: Karen Gullo in federal court in San Francisco at kgullo@bloomberg.net Pam MacLean in federal court in Oakland at pmaclean@pacbell.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.