Cognex serves complaint against barcode patent

March 21, 2006
MARCH 21--Cognex (Natick, MA; has served a complaint against Acacia Research Corporation (Newport Beach, CA; and Veritec Inc. (Golden Valley, MN;

MARCH 21--Cognex (Natick, MA; has served a complaint against Acacia Research Corporation (Newport Beach, CA; and Veritec Inc (Golden Valley, MN; The complaint was filed in the United States District Court in Minnesota.

Cognex is seeking a declaration that US Patent 5,612,524, which claims to cover a system for reading 2-D symbology, is invalid, unenforceable, and not infringed by either Cognex or by any users of Cognex products. The patent has not been asserted against Cognex, but, nevertheless, Cognex has taken this action to protect its customers who have received demand letters. "Cognex firmly believes in the right of inventors and patent holders to seek licensing fees for legitimate, patented technology. But, we strongly object when questionable patents are used to extort payments from companies that do not have the expertise to challenge the patents, or who, for business reasons, decide to submit to licensing demands rather than to undertake costly legal challenges," said Robert J. Shillman, Cognex chairman and CEO.

This patent was originally assigned to Veritec, a Minnesota-based developer of symbology codes, and is now part of a patent-licensing program being carried out by Acacia Technologies Group. Acacia is a publicly held company whose sole purpose is to profit by asserting patents that it has either purchased or to which it has obtained rights.

"The '524 patent-infringement assertions being made by Acacia Research and Veritec are completely without merit and are, in my view, a form of legalized extortion," continued Shillman. "It appears that Acacia first estimates the defendant's cost of mounting a legal defense and then agrees to settle the claim for less than that cost. Even if the defendants believe the assertion is without merit, they nevertheless often choose the less expensive, but distasteful, option of paying off these abusive patent trolls. The tactics used by Acacia/Veritec are similar to those used by the Lemelson Partnership in its infamous licensing campaign that successfully wrung more than $1.5 billion dollars in settlements from ethical companies around the world. That campaign was ended when Cognex defended its customers, sued Lemelson, and won on all counts."

Shillman concluded, "Cognex will continue to challenge any patent that interferes with the legitimate rights of our customers to freely use our products. And, because this particular battle is far less complex than the one we won against Lemelson, we are confident that the courts will, once again, rule in Cognex's favor."

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