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Oak Industries Paid $20 Million in Fees for Patented Technology

July 23, 1987|GREG JOHNSON | Times Staff Writer

SAN DIEGO — M/A-Com and General Instrument Corp. have paid San Diego-based Oak Industries $20 million in license fees for the right to use Oak patents that cover technology included in the two firms' TV and communications signal encryption devices, Oak said Wednesday.

The agreement also ended litigation that Oak had initiated against M/A-Com, based in Burlington, Mass., and General Instrument, based in New York.

Oak had alleged that the electronic signal encryption and deciphering products manufactured by M/A-Com and General Instrument infringed upon nearly 40 of Oak's patents.

Oak will "aggressively continue to police its patents," according to Oak's general counsel, S. James Miller Jr., who added that Oak has similar suits pending against Zenith and Scientific Atlanta.

M/A-Com agreed to settle after learning "just how good a patent library Oak has," a spokesman for M/C-Com said. "We knew they had a number of patents, but we didn't realize just how firm a grasp they have" on the scrambling and deciphering industry.

A General Instrument spokesman characterized the settlement as "a positive thing because it ends all the litigation."

As part of the agreement, Oak received a one-time $20-million settlement payment that gives M/A-Com and General Instrument "non-exclusive licenses to more than 40 Oak patents," according to Miller, who declined to detail what each firm paid.

The Oak patents cover electronic signal encryption and deciphering technology used in several M/A-Com and General Instrument products, Miller said.

The agreement included a license on technology that M/A-Com used to develop the Videocipher devices it began marketing last year to owners of home satellite dishes.

The Videocipher system, recognized as the cable TV industry standard, encrypts and deciphers programming. More than 300,000 of the devices have been sold to owners of satellite dishes who want to receive scrambled programming.

Oak, which initially accused M/A-Com of patent infringement in a lawsuit, sued General Instrument after it acquired the Videocipher business from M/A-Com for $220 million in 1986.

The patents also cover technology used in more-common cable TV "boxes" that viewers use to receive programming over cable systems. "We're obviously pleased with the outcome because it shows that Oak is a pioneer that continues to be an innovator in the business," Miller said.

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