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Kodak patent claim against Apple, RIM goes back to judge

The U.S. International Trade Commission handed down a split decision in Kodak’s high-stakes patent dispute with Apple and Research In Motion over the built-in cameras in smartphones late Thursday. The commission’s latest ruling sends the case back to an administrative law judge, with a final decision not expected until the end of August.

Thursday’s ruling centered around a judge’s decision in January that Kodak’s infringement claim over camera-phone image previews was invalid. Kodak contends that that Apple’s iPhone and Research In Motion’s BlackBerry devices infringe upon its patents by featuring image preview capabilities, taking its rivals to court in 2010.

Kodak was appealing that January 2011 ruling, and it got some backing from the ITC Thursday, which announced that it had decided to “affirm in part, reverse in part, and remand in part” the judge’s earlier decision. Specifically, the commission modified some of the constructions of claim terms that the judge used when ruling against Kodak in January; it’s asking the judge to take another look at the case based on these modified terms. “Because of the modified claim constructions, the Commission believes it appropriate to provide the [administrative law judge] and respondents the opportunity on remand to revisit invalidity,” the six-member panel wrote in its decision. The commission set a target date of August 30 for a final ruling from the judge.

Kodak opted to focus on the positive in Thursday’s ITC ruling. “We are gratified that the Commission has decided to modify in our favor the judge’s initial recommendation,” said Laura G. Quatela, Kodak’s senior vice president, general counsel, and chief intellectual property officer. “As we have said from the start, we remain extremely confident this case will ultimately conclude in Kodak’s favor.”

Investors were feeling less positive. The Wall Street Journal reported that Kodak shares had plunged 16 percent in the wake of the ITC’s ruling.

A more definitive ruling in Kodak’s favor might have pressured Apple and RIM to settle the dispute with the camera company. Kodak has said that winning the case could lead $1 billion worth of royalty payments.

In addition to the ITC case, Kodak has federal court actions pending against RIM and Apple in the Northern District of Texas and in the Western District of New York, where the same issue and additional infringement claims will be adjudicated. Kodak is proceeding with these actions, with the Texas case scheduled to begin on Aug. 1.

John Ribeiro of IDG News Service contributed to this report.

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