Orrick Herrington & Sutcliffe has advised On Track Innovations (OTI), a manufacturer of contactless microprocessor-based smart card solutions, in a landmark patent settlement agreement with Smartrac, a manufacturer of radio frequency identification transponders. The settlement, agreed on 9 November, was reached after more than two years of litigation in multiple jurisdictions.
OTI’s case began in August 2007 when Orrick filed a patent invalidation on behalf of OTI before the China Patent Re-examination Board against Smartrac’s Chinese invention patent. In June 2008 Smartrac filed customs actions in Shenzhen and a patent infringement suit in the Shenzhen Intermediate Court against Millennium Card Technology (MCT), a subsidiary of OTI. As MCT is the primary Chinese manufacturing base for OTI smart cards, the successful outcome of this case was critical for OTI’s global business.
According to Orrick’s Beijing partner Wang Xiang, Orrick advised OTI on all the Chinese legal proceedings to which it was a party, as well as on its patent re-examination in the United States and interests in Hong Kong. “We believe that the victories in the various Chinese legal actions provided OTI with a significant leverage in its multi-jurisdiction disputes with Smartrac in China, the United States, Germany, Holland and other jurisdictions, which ultimately led the settlement,” commented Wang.