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Friday, February 03, 2006
Patent Office to Re-examine JPEG Patent

U.S. Patent and Trademark Office will re-examine the validity of the JPEG patent held by Forgent Networks, an action that could deprive the company of its multimillion-dollar revenue stream.

The Patent Office granted the review at the request of the Public Patent Foundation (PUBPAT) which claims it is a not-for-profit legal services foundation interested in protecting the public against harm caused by patents. The foundation is funded primarily through grants from the Rockefeller Foundation, the Open Society Institute and the Echoing Green Foundation and private donations from the public.

According to the PUBPAT, the Patent Office accepts many requests for re-examination. In 70 percent of the cases, the Patent Office will make some sort of change although many of the changes stop short of invalidating the patent.

"We believe the patent is invalid and, therefore, expect it to be revoked in its entirety," told CDRinfo Mr Daniel B. Ravicher, Executive Director of PUBPAT.

Forgent acquired the rights to the JPEG compression patent through a 1997 purchase of Compression Labs, however it did not start asserting its ownership and demanding licensing for the patent until a year ago. It has since then become one of the more successful intellectual property firms to emerge in the last few years.

Forgent Networks has sued many companies including including Adobe, Microsoft, Apple, Sun, RIM and Google and Microsoft. For more information see Forgent sues Microsoft Microsoft and JPEG case in progress

Forgent has collected around $105 million in royalties from different electronics and software companies. A case in which Forgent is suing PC makers is pending in U.S. District Court in San Francisco. Forgent executives have said the patent could be worth up to $1 billion.

If the patent is deemed invalid, the company would not be eligible to collect future royalties or pursue lawsuits on the patent. But Forgent would not have to disgorge previous royalty payments, said a Forgent spokesman.

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