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Apple, RIM Targeted by Openwave in Mobile Device Patent Case

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Aug. 31 (Bloomberg) -- Openwave Systems Inc., a maker of software for mobile phones, filed patent-infringement complaints against Apple Inc. and Research In Motion Ltd., seeking to block U.S. imports of the companies’ phones and tablets.

Apple’s iPhone, iPad and iPod Touch, as well as RIM’s BlackBerry Curve and Playbook, infringe five patents for ways mobile devices connect to the Internet, Openwave said today. The company filed cases with the U.S. International Trade Commission in Washington and a federal court in Wilmington, Delaware.

Openwave, which reported $38.9 million in revenue in the fiscal quarter ended in March, said it took action after failing to “receive a substantive response” to requests for a licensing deal with Apple and RIM. The ITC can block imports of products that infringe U.S. patents, and a favorable decision “will lead the companies to negotiate licensing agreements,” Redwood City, California-based Openwave said in a statement.

“There are people in the world who deliver products into the market that are leveraging our patented technology,” Openwave Chief Executive Officer Ken Denman said in a telephone interview. The inventions are “foundational to the mobile Internet and we believe it’s only right we get paid for the use of our foundational technology.”

Openwave climbed 44 cents, or 30 percent, to $1.91 at 4 p.m. New York time in Nasdaq Stock Market trading, its biggest percentage increase since October 2002. Apple, the world’s biggest maker of smartphones, fell $5.16 to $384.83. RIM fell 6 cents to $32.49.

Patent Licensing

Kristin Huguet, a spokeswoman for Cupertino, California-based Apple, and Marisa Conway, a spokeswoman for Waterloo, Ontario-based RIM, declined to comment on the litigation.

The complaint is part of a program started more than two years ago to generate more money from the company’s intellectual property and Openwave is in talks with other parties, Denman said without naming the companies.

Openwave provides software to phone-service providers including AT&T Inc. and Sprint Nextel Corp., Australia’s Telstra Corp., Deutsche Telekom AG and Taiwan Mobile Co. The company got about 31 percent of its sales from licensing in the quarter ended in March, according to data compiled by Bloomberg.

The patents in the complaints announced today cover ways to let Web pages and applications communicate with a server, share data across different devices, access updates to applications, connect to e-mail without a network connection such as in a “dead zone,” and for software on the phone to interact with corresponding software on a server.

If the ITC agrees to investigate the complaint, the probe would likely be completed in 15 to 18 months. The companion civil suit in federal court would be put on hold until the ITC completes its work.

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

To contact the editor responsible for this story: Allan Holmes at aholmes25@bloomberg.net

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