A U.S. trade panel has agreed to investigate claims that Toyota infringed privately held patents in designing its hybrid electric vehicles. Toyota is widely acknowledged to be the industry leader in hybrids, having sold more than 2 million globally since 1997.
If the allegations are upheld by the U.S. International Trade Commission (ITC), Toyota could be ordered to stop using the patented technology in its Hybrid Synergy Drive system, and to bar the import of any Toyota vehicle containing it.
A vehicle must come with electronic stability control and earn top marks in all front, side, and rear tests to win the agency’s top award
2010 Lexus HS 250h
2010 Lexus HS250h – door badge
2010 Toyota Prius
Toyota: We will prevail
Toyota, meanwhile, issued a strongly worded statement saying it would prevail, saying it “has many patents on the hybrid technology.” It added that it “believes that it has strong defenses against all of Paice’s claims and…will prevail in the ITC proceeding.”
The claim comes from Paice LLC, of Bonita Springs, Florida. Paice had previously sued Toyota in a U.S. court in Texas over the same claims. In April, Judge David Folsom ordered Toyota to pay a licensing fee (of roughly 0.5 percent of wholesale price) to Paice for every hybrid it sold but declined to bar imports of the company’s hybrid vehicles. Toyota has appealed that order.
The new complaint applies to the Toyota Camry Hybrid, the third-generation 2010 Toyota Prius, the 2010 Lexus HS250h sedan, and the latest 2010 Lexus RX450h crossover infringe the same patent.
2005 jury verdict against Toyota
In 2005, Paice convinced a jury that earlier models of the Toyota Prius, Toyota Highlander Hybrid, and Lexus RX400h hybrid vehicles used its inventions. Toyota was fined $4.3 million in the case.
That verdict was upheld on appeal, leading Paice to argue in the current complaint that Toyota cannot challenge the validity of the Paice patent or argue that the company’s latest hybrid models don’t infringe it.
By now, Toyota has fought several claims before the ITC. The commission, set up to bar unfair trade practices, can bar specific imports but cannot impose royalty payments or financial penalties. To win its case, Paice must demonstrate that it can successfully market and profit from its patents.
Last year, Toyota prevailed when the ITC rejected a related claim by Solomon Technologies of Tarpon Springs, Florida. That company had argued that Toyota infringed its patents on transmission technology. An appeals court upheld the ITC rejection. Solomon has also filed a civil suit against Toyota in Federal court in Tampa.
[Reuters, Bloomberg]
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