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October 18, 2005

No Freedom For Wireless

A federal judge in Boston granted an injunction Monday against Boston Communications Group Inc. (BCGI) for infringing patents owned by Freedom Wireless. In the ambiguous understatement of the year department, E.Y. Snowden, chief executive of BCGI, proclaimed ''Our fight is far from over."

The district court ruled on May 20 that Boston Communications had infringed two Freedom Wireless patents, awarding Freedom Wireless $128 million in damages. Last week, the court added $20 million in interest on lost royalties, and said it would consider further damages.

Under the injunction, wireless companies that use the BCGI prepaid wireless services must stop selling them. The companies have 90 days to continue serving current customers, during which they must pay royalties to Freedom Wireless.

Boston Communications said that the injunction could affect service to 3.1 million prepaid customers, including 400,000 at Cingular Wireless. This represents 70 percent of BCGI's total revenue. BCGI has asked the judge to stay the injunction while it files an appeal of the judgment.

Cingular Wireless spokesman Mark Siegel said the injunction does not apply to the "vast majority" of Cingular's prepaid wireless customers, who use a different type of network technology. Cingular is also seeking a stay of the injunction while it begs for mercy.

Boston Communications stock, now worth around $1.11 per share, has lost 80% of its value since the May jury damage award.

Cingular Wireless and AT&T Wireless, which Cingular bought last year, were co-defendants in the suit against BCGI. Verizon Wireless was also a co-defendant, but, a better reader of the writing on the wall, reached a settlement with Freedom Wireless before the trial began earlier this year.

Posted by Patent Hawk at October 18, 2005 9:02 PM | Patents In Business