Orrick Prevails for Charles Schwab & Company in Marshall, Texas Patent Suit

Business Wire,  August 22, 2007  

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NEW YORK -- Orrick, Herrington & Sutcliffe patent litigators and trial lawyers Robert Cote and Rodger Sadler were victorious for defendant Charles Schwab & Company in a patent suit pending for the past two years in the Eastern District of Texas. U.S. District Court Judge David Folsom, who was reassigned the case from Judge T. John Ward late last year, issued an order on August 2, 2007 denying the plaintiffs' motion for reconsideration of a May 22, 2007 order dismissing the case against Charles Schwab.

The plaintiffs (William Reid and a patent holding company called Net P&L, Inc.) alleged infringement in the suit by enterprise software systems using web services oriented architecture, metadirectory, and LDAP directory solutions for identity management and access control of servers, routers, and other network resources of a corporate intranet.

It was learned during discovery that the inventor, William Reid, who described himself in the press as a "former IBM scientist," assigned all "innovations" conceived of during his employment to a now-defunct former employer, Plancom, if the innovations "reasonably related" to Plancom's business. Plancom was in the business of building a network of wireless LAN access points or hotspots across the country, providing subscribers with "connectivity" from airports, hotels, and retail stores to the Internet or their corporate networks. The Court, in ruling the patent-in-suit (U.S. Patent No. 6,131,120) was "reasonably related" to Plancom's business, found that the patented invention and Plancom's business both related to network security and that Reid had conceived of the subject matter of the patent during his employment at Plancom.

The case was followed by financial services and technology companies because the plaintiffs, with self-professed "visions of wealth beyond avarice," had hinted in the press that the patent would eventually be asserted against the entirety of corporate America, since according to plaintiffs "virtually all corporations" use the patented system to manage employee and/or customer identity and access to corporate networks.

The plaintiffs were represented by the Nix Patterson & Roach LLP firm, which is also currently handling a patent licensing and enforcement program for the DataTreasury Corporation.

About Orrick

Orrick, Herrington & Sutcliffe LLP is a global law firm with approximately 980 lawyers in North America, Europe and Asia. The firm focuses on litigation, complex and novel finance and innovative corporate transactions. Orrick clients include Fortune 100 companies, major industrial and financial corporations, commercial and investment banks, high-growth companies, governmental entities, start-ups and individuals. The firm's 18 offices are located in Beijing, Hong Kong, London, Los Angeles, Milan, Moscow, New York, Orange County, Pacific Northwest, Paris, Rome, Sacramento, San Francisco, Shanghai, Silicon Valley, Taipei, Tokyo and Washington, D.C.

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