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Archive Corp. Can Continue to Sell Drives

Archive Corp. of Costa Mesa may continue selling a line of 5.25-inch tape drives until a patent dispute is settled, a federal court ruled Thursday.

Cipher Data Products of San Diego had asked for a preliminary injunction barring sales based on loading technology used by both companies’ products that enables tape cassettes to be inserted sideways into the tape drives. A trial date to settle the patent validity and infringement battle has been tentatively set for May, 1989.

Cipher alleges that the technology is covered in a patent awarded to the company in 1986, while Archive alleges that the product actually uses Archive technology that was licensed to Cipher Data under 1981 and 1983 agreements.

Leadership in Market

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At stake could be Archive’s leadership in the market for 5.25-inch tape drives. Archive accounts for about 20% of the $400-million market for the products, a computer data storage device.

Analysts said Cipher’s position was bolstered in June when it settled a similar patent infringement action against Wangtek.

In a statement hailing the court’s denial of the motion, Archive Chairman D. Howard Lewis said: “We feel strongly that Cipher’s patents are invalid and not infringed and that we will prevail in court next year.”

The motion for the preliminary injunction was filed in September in U.S. District Court for the Central District of California.

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“The fact that the motion was denied has no bearing on the ultimate disposition of the litigation and does not preclude us from seeking an injunction at another time,” Cipher Data Director of Communications Peter McGuirk said Thursday.


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