Finisar Ruling Vacated

Finisar comments on DirecTV appeal ruling

April 18, 2008

2 Min Read

SUNNYVALE, Calif. -- Finisar Corporation (NASDAQ: FNSR), a technology leader in gigabit fiber optic solutions for high-speed data networks, today announced that the United States Court of Appeals for the Federal Circuit has decided the appeal of the patent case Finisar brought against DirecTV for infringement of U.S. Patent No. 5,404,505. The invention in question was developed by Finisar co-founder Frank Levinson and involves methods for transmitting and broadcasting digital information. At trial, Finisar was awarded $78.9 million by the jury with an additional $25 million awarded for willful infringement plus back interest and an ongoing royalty stream. DirecTV appealed the jury's verdict.

The Federal Circuit ruled that the trial court's interpretation of certain terms in the patent was too broad and it therefore vacated the jury's verdict of infringement. In doing so, however, the court indicated that there may still be infringement of the patented methods, even under its more narrow interpretation. The appeals court also held that claim 16, one of the seven patent claims at issue, is invalid, but left standing the remaining six claims for reconsideration by the trial court. The appeals court also reversed the jury's finding that DirecTV's infringement was willful.

While Finisar is disappointed in the court's ruling on willfulness and invalidity of claim 16, it is optimistic that the trial court will once again find infringement of the remaining six claims. "We remain confident that the questions of infringement and validity, upon further review by the trial court, will be decided in favor of Finisar," said Finisar's primary trial counsel, Larry R. Laycock, of the law firm of Workman Nydegger.

Finisar anticipates that the six remaining claims at issue will be held valid and infringed and is committed to continuing its enforcement of intellectual property rights in this matter.

Finisar Corp. (Nasdaq: FNSR)

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