Kodak loses RIM, Apple patent case: Bankruptcy recovery looks bleak

Summary:Kodak's bounceback looks bleak after a key patent was dismissed by the U.S. ITC, throwing a spanner in the works for the doomed former photo giant.

Kodak has lost an appeal in a case which ruled that Research in Motion or Apple did not violate a patent that the former photo giant claimed it owned. 

RIM and Apple were accused of violating the patent in early 2010 in their respective smartphone platforms. The patent was designed to display still images following a picture snap on smartphones and LCD displays on digital cameras. But an appeals court heard that U.S. Patent No. 6,292,218 had not been infringed by either company and it was ruled that the patent was invalid.  

As the company continues to recover $1 billion to stave off the company's inevitable collapse, this latest ruling throws yet another wrench in the corporate machine.

Kodak has more than 1,100 patents it wants to sell, and could be be worth as much as $2--3 billion. The bankrupt company said it has generated more than $3 billion in licensing revenues since 2001, but a full-scale sell-off could layer the hole it's in with enough cash for it to climb out of.

The Rochester, New York-based photo company  won the right to sell off its patents amid bankruptcy , but this latest decision may set back even that decision.

But the '218 patent is thought to be one of Kodak's most important and lucrative, and the company wants to sell off what it can, when it can, as soon as possible. It's looking for an auction date next month.

But realistically, because it was such a high revenue driver out of its vast patent portfolio, Kodak may not be able to generate enough money to get back into business without its '218 patent. 

Kodak just can't catch a break. Arguably, it probably doesn't deserve it all that much. The once proud photo giant suffered financial mismanagement which in part led to the company's bankruptcy, but also failed to innovate in the digital camera space, leaving it out in the dust while competitors and smartphone makers stormed ahead.

Topics: Patents, Government : US, Tech Industry

About

Zack Whittaker writes for ZDNet, CNET, and CBS News. He is based in New York City.

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