Storage Computer Draws First Blood

Storage Computer Corp. (AMEX: SOS) has won the first skirmish of the first battle in what could become an outright patents war on the storage networking industry.

The company is planning to file as many as 60 suits against companies that it alleges have infringed its virtualization intellectual property rights (see Storage Computer: Fighting Talk). And it appears to have won the upper hand in its first case -- against storage giant Hitachi Data Systems.

In its initial complaint, to a U.K. court, Storage Computer alleges that certain Hitachi storage products infringe its intellectual property relating to two European patents. One of the patents is called Fault-tolerant, Error-Correcting Storage System and Method for Storing Digital Information in Such a Storage System” and the other is "High-Speed, High-Capacity, Error-Correcting Storage System for Binary Computer.”

Hitachi attempted to have the claim against the first patent, which covers fault tolerance and error correction methods, dismissed, a process known in the U.K. as a “strikeout application."

The Patent Court denied the motion.Hitachi did not request a “strikeout application” against the second infringement claim. But it did ask for a stay of postponement, allowing for more time to prepare for both patent infringement cases. The Court also denied this motion, so the case will now proceed to trial.

A source close to the case, who requested anonymity, say this is “a positive outcome for Storage Computer as the court feels there is substance behind the patents and wants to move forward quickly.”

The speed of this trial is a critical issue for Storage Computer, as the company has recently launched new products and is making somewhat of a comeback. Analysts fear that if it gets bogged down in legal shenanigans, this comeback might be short-lived.

“Patent litigation is a dangerous game to get into,” says Andy Barrengostechnology practice leader at law firm, Woodruff-Sawyer & Co. “It’s very expensive and can take years before the trial even begins.”

— Jo Maitland, Senior Editor, Byte and Switch http://www.byteandswitch.com