Toyota Hybrids Could Be Banned From U.S.

[Dragon]

http://www.allcarselectric.com/blog/103492...o-patent-issues

With sales of Toyota hybrids booming in its home country and elsewhere across the globe, Toyota leads the competition in the hybrid market. Seemingly every hybrid model developed by the company fares well including the newly released Lexus HS 250h. So what could hold Toyota back in this hybrid race? Patent infringements could. Depending on the judgment by U.S. courts, Toyota's imports of certain hybrid models could theoretically be entirely blocked from the U.S. shores.

Toyota faces patent infringement claims from a company called Paice LLC. Paice filed an official complaint with the U.S. International Trade Commission on Thursday in Washington, D.C. The fling, not immediately available for public viewing, claims that Toyota has infringed upon several of the patents awarded to Paice in regards to drive trains for hybrid vehicles. Paice's filing seeks a complete ban on several Toyota models from out market including the Prius, Highlander Hybrid, Camry Hybrid, and several Lexus hybrid models.

Does Paice have a viable case? Back in 2005, Paice won their initial case against Toyota claiming that the Prius, Highlander and Lexus RX400h used Paice inventions related to drive trains. The next trial is set to begin in a federal court in Marshall, Texas in October. This trial claims that the Camry hybrid infringes on the same patents discussed above. An additional case also looms ahead in Marshall claiming that both the Highlander hybrid and all Lexus hybrid models infringe upon those same patents.

The trials listed above are minor, and Paice wants the case heard in Washington which is the reason for their newest filing in this nation's capital. If the International Trade Commission agrees to hear the case of Paice LLC vs. Toyota Motor Corporation, the trial could begin immediately and last for up to 15 months.

If Paice wins, the commission has the power to entirely block all imports of the infringing models from our shores forever. Toyota should be concerned as this could significantly impact hybrid vehicle sales in the U.S. Though the case does seem to be a great example of the class David Vs. Goliath tale. But Paice does have the previous victory over Toyota going for them and at least a fighting chance of winning the case if and only if the commission agrees to hear it.

Imagine Toyota with no hybrids to sell in the U.S. and an EV years away. They would be in a heap of trouble hear if Paice manages to prove that the company stole their innovations. We will have to wait and see if the commission will hear the case and whether or not Toyota hybrids will exit our country for a long time.

[Blake Noble]

It seems Toyota is falling apart worse than GM did.

[gm4life]

I would love this! This would be great, and it would keep people out of more $h!ty small crap boxes.

[Camino LS6]

Damn.

[intrigued]

Wow... truly a David and Goliath but one with potential dire results for Toyota.

Paice deffinetly has a leg to stand on because they have precident on their side in the prior court victories. If they are moving for an immediate trial then they must have done a TON of prep work and found serious hard to dispute facts supporting their prior victories.

If this goes Paice's way the following will most likley happen.

Toyota will have to immediatly stop selling all hybrids.

All cars they have not sold may be destroyed as infringing property.

They will have to pay Paices legal expenses which could easily be in the millions.

They will have to pay damages, probably somewhere between the OEM cost of all the infringing components and the cars themselves. This would be for ALL hybrids sold between 2005 - present

If it is found that Toyota knowingly and miliciously ripped off the patents then puntive damages will be awarded. This is also known as "trebble" damages and is in addition to normal damages. Punitive damages are 3x whatever the normal damages comes out to.

This could cost possible cost Toyota 10s of Billions, it's a boat load of terrible PR and they will effectivle be out of the hybrid market for years till they can reorganize and re develop their products.

There are many ways it could end short of this, settlement or Toyota could get a crack team of attorneys who succesfully defend them.

But Paice deffinetly has a decent shot at winning. They would not have gone forward with a suite of this size if they didn't.

On Tuesday when I go back in to work I'm going to look up all their cases on Lexis Nexis and Pacer and see if I can find the filing papers once they become public and see the piror cases that are related to it.

If I can get them I will post them online here.

[FAPTurbo]

I think this will be settled out of court.

This happens to tech companies all the time; I think it's RAMBUS that always seems to be out suing someone or other over patents that they registered, just to earn money.

[Camino LS6]

Have to agree that a settlement is likely.

Still...

Sounds like Toyota really screwed the pooch with this one.

[Drew Dowdell]

What does this mean for Ford? If Ford made a license agreement with Toyota because their hybrid came too close the the mark, I would think they'd be the next target.

edit: And Nissan too.

GM's Two-Mode and Honda's IMA are substantially different from the Toyota model.

[Camino LS6]

What does this mean for Ford? If Ford made a license agreement with Toyota because their hybrid came too close the the mark, I would think they'd be the next target.

Good point.

Loads less exposure for Ford, though.

[Paolino]

They'll come to an agreement and I bet the public will not know about it.

[Robert Hall]

I'm sure Toyota can crush Paice...it's a small operation know one has ever heard of--is it just a scam/shell operation that creates patents but no product?

Their website is a joke..

Paice LLC

I'm no Toyota fan, but I despise scammers, esp. patent trolls.

Edited September 6, 2009 by Cubical-aka-Moltar

[smk4565]

As much as I'd love to see Toyota get screwed, they'll probably just pay Paice off and move on. Paice is probably making a fuss about it just to get a quick payday. Plus, the government loves hybrids, they wouldn't allow someone to block Toyota from selling 250,000 hybrids a year.

[Dragon]

some of these companies can be pretty persistent.

Just look at that small TO firm that took on Microsoft and got Word pulled.

[Justin Bimmer]

two words to pace:

good luck

[cletus8269]

I think this will be settled out of court.

This happens to tech companies all the time; I think it's RAMBUS that always seems to be out suing someone or other over patents that they registered, just to earn money.

yeap, sony's battle for the patent infringements on the sixaxis controllers come to my mind. they settled too, massively...

[capriceman]