Federal Circuit Reinstates Handwriting Recognition Patent Suit

In a stunning ruling, the Federal Circuit has reversed a lower court and remanded a case for trial on Xerox's claim of patent infringement relating to Palm's handwriting recognition technology.

The patent covers "Unistroke" software developed by Xerox. The technique recognizes one stroke motions as characters. Xerox contended in the court below that the Palm Graffiti handwriting recognition system infringes the patent. Palm filed a motion for summary judgment, and the district court agreed that the Palm system did not infringe.

This morning the Federal Circuit reversed the district court's grant of summary judgment in Palm's favor, setting the stage for a trial on the issue of infringement.

The potential consequences for Palm (and for other makers of PDA's that use handwriting recognition) are staggering. "Depending on the details of infringement, Palm could be liable for royalties for every unit sold," said Ted Stevenson, a patent litigator with Hughes & Luce. "To the extent that Xerox has offered a competing product, the situation could be even worse -- Palm could be liable for lost profits."

The judicial ruling represents potential vindication of Xerox's embarrassing record of letting innovations slip through its fingers. Although widely credited for developing graphical user interfaces, the computer mouse, object-oriented programming, and other fundamental innovations of personal computing, Xerox has only recently sought to enforce its intellectual property protecting those inventions.