Archive Seeks to Enforce Patents on Tape Drives : Technology: Competitors of the Costa Mesa firm say its move could hinder cooperation and development of industry standards.
Archive Corp. is asking competitors to review whether they must pay it license fees related to patent rights acquired with its recent purchase of Cipher Data Products, a company official said Tuesday.
Tag Merrick, general counsel for Archive, said the company is in “preliminary discussions” with competitors about patents that the company holds on its data tape-drive backup products. He said the company is not yet threatening lawsuits.
“Archive has valuable patent rights and seeks to maximize the value of those patent rights,” Merrick said, adding that this concern largely arose after the acquisition of San Diego-based Cipher Data in April.
Bob Abraham, vice president of Freeman Associates in Santa Barbara, a management consulting company that follows the tape-drive market, said the company appears to be attempting to enforce patents held by its Cipher Data subsidiary. Those patents apparently apply to 5 1/4-inch and 3 1/2-inch tape drives, Abraham said.
Tom Parkinson, president of Rexon in Manhattan Beach, said the company’s Wangtek subsidiary had been notified that it should review a list of patents held by Archive. He declined to identify the products involved, but he said the company’s lawyers are reviewing the patents to assess their validity and determine whether Wangtek is in violation.
If patent infringement lawsuits are filed, Parkinson said, “It would be a very wrong thing for an industry that traditionally works together. This kind of thing hurts the overall market because it disrupts the efforts towards creating technology standards.”
He said that Wangtek will have paid royalties of $12.5 million by October as a result of a patent infringement case filed by Cipher Data three years ago. Cipher Data also sued Archive, but the litigation ended with the acquisition.
Costa Mesa-based Archive has about 50% of the $522-million market for data-cartridge tape drives, followed by Wangtek, Tandberg Data, CMS Enhancements in Santa Ana, and Sankyo Seiki America, Abraham said. CMS officials said they have not been contacted by Archive.
