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nCUBE claims victory in VOD patent spat

Sun, 06/30/2002 - 8:00pm
Staff

A Delaware District Court jury has unanimously upheld an nCUBE Corp. patent for video-on-demand, ruling that rival vendor SeaChange International "willfully infringed the patent."

The jury also ruled that SeaChange must pay nCUBE in excess of $2 million in damages, plus a seven percent royalty on all sales of infringing products after Feb. 1, 2002.

SeaChange executives said the company likely will accrue those monies in the interim or until all appeals are exhausted. It's expected that the ruling won't spell an end to the legal battles between the two VOD competitors, which already have a long litigious history between them.

In June 2000, SeaChange filed a lawsuit against nCUBE for infringement over U.S. Patent No. 5,862,312, which was granted to SeaChange on Jan. 19, 1999. The '312 patent describes a "loosely coupled mass storage computer cluster."

In that case, a Delaware District Court jury rejected nCUBE's challenge on Sept. 25, 2000, ruling that SeaChange's patent was valid. SeaChange has since asked the court to enter a judgment of infringement and a permanent injunction against nCUBE's MediaCube-4 video servers. No final judgment has been entered in the '312 case.

On Jan. 8, 2001, nCUBE countered with a suit of its own, alleging that SeaChange's iTV System infringed on U.S. Patent 5,805,804, which was issued to nCUBE on Sept. 8, 1998. The '804 patent describes "a unique video server architecture specially suited for VOD delivery." Further, the patent describes how video servers under that architecture can be made compatible–"while requiring only minimal changes"–with the existing systems of other providers. Judge Joseph J. Farnan Jr. is presiding over both cases.

Concurrent Computer Corp., meanwhile, appears to be sufficiently insulated from the ongoing VOD patent war, thanks to its investment in Thirdspace Living Ltd., a supplier of video server system software for DSL-based VOD services that is partly owned by Alcatel and Larry Ellison's Oracle Corp.

In addition to investing in Thirdspace, Concurrent, more importantly, also received a license for Thirdspace's existing patent portfolio as well as pending patents. That portfolio also is shared by nCUBE, which is majority-owned by Ellison.

Concurrent Chief Financial Officer Steve Norton said Concurrent's investment in Thirdpsace wasn't done only to protect the company from potential litigation, but to help the company make inroads in the international VOD-over-DSL sector.

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