Court Upholds Patlex Rights to 3rd Laser Patent

Patlex Corp. won another legal victory last week by wrapping up the rights to a third key laser patent, furthering the Chatsworth company’s chances for great riches.

The U.S. District Court in Washington upheld a laser use patent that had been issued to inventor Gordon Gould, Patlex’s vice chairman, in 1979. In 1982, however, the Patent Office decided to re-examine Gould’s patent. But the District Court concluded that the Patent Office’s arguments were not sufficient to rescind the patent.

The Patent Office has 60 days to appeal the decision.

‘A Satisfying Year’

“It’s been a very satisfying year,” said Richard Samuel, Patlex’s chairman. The company owns 64% of the rights to Gould’s various laser patents, in exchange for which Patlex has been footing the legal bills as it tries to conclude the lengthy dispute over Gould’s inventions. This year alone, Patlex’s legal tab is $1.25 million, Samuel said.

Gould, who owns 20% of the rights to his patents, originally filed for his laser use patent in 1959.

Gould came up with the acronym laser --light amplification by stimulated emission of radiation--and the powerful beams of light are now used in everything from eye surgery to computer printers and steel manufacturing.

After years of legal battles, Gould and Patlex have had little to show for their efforts. For the nine months ended Sept. 30, Patlex lost $2 million on $9.2 million in sales.

But that will now change. Samuel expects Patlex to close out its year with a profit, and with Gould and Patlex on the verge of collecting big returns, the company’s stock has surged from $5.75 per share after the stock market crash Oct. 19 to close at $14 Monday.

The trio of laser patents that Gould holds covers 90% of the estimated $600-million market in non-military uses for lasers. On average, Patlex gets 5% royalty payments from companies using Gould’s laser technology. With a total market of $600 million, Patlex would take in about $19 million in royalties next year, and Gould would get an additional $6 million.

“We’re guessing like everyone else. It could be half or twice that amount,” Samuel said.

Contracts Signed

Since last month, Samuel has signed contracts for $4.8 million worth of back royalties that the companies owed Patlex, plus future laser royalty deals. To date, Patlex has signed about 20 companies to royalty contracts, including Motorola, IBM, General Motors and 3M. Samuel said he expects to sign another 50 to 75 firms.

Last month, Patlex won another legal battle when Gould was finally awarded a patent for his gas-discharge laser. Earlier, Gould had been awarded a patent for an optically pumped laser.

The names refer to different power sources used to trigger a laser. Some lasers use a light charge; others are triggered by an electrical discharge in a gas.

Those two patents cover the manufacture of lasers. The latest use patent, however, covers the use of lasers in cutting, welding, drilling and chemical reactions.

There is a fourth laser invention at stake, called the Brewster Angle Window, which involves a design used in many gas-discharge lasers. Gould’s patent application is before the Patent Office’s Board of Appeals, and Samuel expects a decision in January.

This last design is not as vital as the other three, Samuel said, but would further solidify Patlex’s claim on royalties from manufacturers of gas-discharge lasers.

Developed Ideas as Student

Gould, 67, who lives in Kinsale, Va., developed his laser ideas while a graduate student of physics at Columbia University.

“The basic principle popped into my mind one night when I couldn’t get to sleep, and it was so exciting that I just spent the whole rest of the weekend writing it down,” he said.

Years later, Gould suffered from cataracts, and his sight was saved as a result of laser surgery.

Although Gould said he feels “immense satisfaction” at having his laser inventions vindicated in court, the 30-year struggle has been wearying.

“If I had any idea that it could take this kind of time, I would have dropped it decades ago,” he said.