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Starent Fights UTStarcom

Starent Networks Corp. appears to have drawn first blood in its ongoing patent-infringement lawsuit with UTStarcom Inc. (Nasdaq: UTSI).

The origin of the spat was the acquisition of CommWorks by UTStarcom in March 2003 (see UTStarcom Cops CommWorks). A number of Starent execs once worked at CommWorks before establishing the startup, and UTStarcom claims that Starent has deployed technology based on patents once owned by the business it acquired.

The dispute led UTStarcom to file a complaint against Starent in March last year, claiming that Starent’s ST-16 Intelligent Mobile Gateway product infringes upon two UTStarcom patents (see UTStarcom Battles Starent). In August 2004 UTStarcom pulled one of the patents from its lawsuit, leaving the companies to battle over a sole claim (see UTStarcom Cuts Starent Battle).

A year later, and the fight is still rumbling on. According to UTStarcom’s latest 10-Q quarterly report with the Securities and Exchange Commission (SEC), on February 17 this year UTStarcom attempted to enforce "a preliminary injunction against Starent’s use, sale, and offer for sale of products having the infringing feature."

However, UTStarcom was denied this preliminary injunction on June 17 by the U.S. District Court for the Northern District of California.

“In order to get that motion, UTStarcom basically had to prove that it was likely to prevail in the [eventual] case, and it was unable to do that,” says Starent CFO, John Delea. “Right now, we are tentatively scheduled for trial next year.”

UTStarcom has also upped the stakes further, opting to file a second complaint again. “On February 16, 2005, we filed a second suit against Starent for patent infringement in the U.S. District Court for the Northern District of California,” notes the 10-Q report. “On May 6, 2005, we served the Complaint on Starent. In the Complaint, we assert that Starent infringes a UTStarcom patent through Starent’s development and testing of a software upgrade for its customer’s installed ST-16 Intelligent Mobile Gateways. We seek, inter alia, declaratory and injunctive relief.”

Starent’s Delea says no court date has yet been set for this lawsuit. “It’s still fairly early in the process. It might not to go trial until 2007 or 2008. We believe our position is very strong with respect to our non-infringement, and we have a very good argument on the unenforcability of the patent. We expect to prevail.”

UTStarcom was unavailable for comment at press time.

— Justin Springham, Senior Editor, Europe, Unstrung

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deauxfaux 12/5/2012 | 3:04:09 AM
re: Starent Fights UTStarcom Not taking sides, clarifying.....
cyber_techy 12/5/2012 | 3:04:16 AM
re: Starent Fights UTStarcom UT Starcom is as much a chinese as Starent is Indian. Most of their development was and is being done in India. So why take sides?
deauxfaux 12/5/2012 | 3:04:18 AM
re: Starent Fights UTStarcom Not only is Softbank one of UTSI's largest shareholders, so is Masayoshi Son personally!!!

Son even used to be on UTSI's board if I remember right.
paolo.franzoi 12/5/2012 | 3:04:21 AM
re: Starent Fights UTStarcom
DF,

Do you or anybody else out there doubt that their Yahoo BB deployments are based on the fact that both companies are funded by Softbank.

seven
alcaseltzer 12/5/2012 | 3:04:22 AM
re: Starent Fights UTStarcom The "attacks" weren't about management dominance. The original post suggested it was ironic that a Chinese company is suing a US company for patent infringement, considering it has typically been the other way in recent years. (e.g. Cisco/Huawei)
deauxfaux 12/5/2012 | 3:04:22 AM
re: Starent Fights UTStarcom It is clear that UTSI's "center of mass" (headcount and facilities) is in China, most of their suppliers are chinese, they sell mostly in China, and nearly all of their Senior management is Chinese.

They aren't getting any traction in the US, and their YBB deployments in Japan have been snuffed by NTT.

They are a Chinese company with a NASDAQ listing
exnortel2 12/5/2012 | 3:04:22 AM
re: Starent Fights UTStarcom Hmmm, interesting posts. But why limit the attack on the Chinese ? UTStarcom is a company run by many Chinese execs. But this type of "management dominance" is not limited to Chinese. Ask those who were laid off from the Nokia DSL unit shutdown in Santa Rosa California for their experience.

OK. That said. How about the Korean companies (LG, Samsung etc.) and other foreign companies ? Two exceptions I know of are Nortel and Air Canada, which are being run by US CEOs.

optical_man 12/5/2012 | 3:04:23 AM
re: Starent Fights UTStarcom UTStarcom is incorporated in the U.S.
HQ in Alemda, CA.

90% of business in the Orient.
100% of leadership is Oriental.
Why are you splitting hairs over where the Articles of Incorporation are?

This is a Chinese company, legally papered in the U.S.

Show me their U.S. wins and efforts to win U.S. business and I will agree.

U.S. VP of Sales, Dave Robison, left the company because he could sell nothing in the U.S. with the Chinese management's view towards building gear for the Orient and not the U.S.

End of Story.
Please attack me now.
alcaseltzer 12/5/2012 | 3:04:23 AM
re: Starent Fights UTStarcom Don't let the NASDAQ listing fool you...

UTStarcom is very much a Chinese company, from the founders to the management to the corporate culture to the technology and revenue drivers.

Ask any former UTSI New Jersey employee about the white purge engineered by (Chinese) business unit managers in Hangzhou...
roy_liao2001 12/5/2012 | 3:04:24 AM
re: Starent Fights UTStarcom Hong holds a B.S. in Civil Engineering from the University of California, Berkeley
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