Kodak loses patent case vs. Apple, RIM; plans appeal

(Reuters) - Eastman Kodak Co has lost an appeal of a patent dispute over digital image preview technology with Apple Inc and Research In Motion Ltd, which could set back the onetime photography giant's efforts to raise money in bankruptcy by selling patents.

The U.S. International Trade Commission on Friday upheld a May 21 ruling by Judge Thomas Pender of that agency that neither Apple nor RIM had violated Kodak's rights in the so-called '218 patent, which covers how digital cameras preview images.

"The investigation is thus terminated," the agency said.

Kodak has been hoping to recover $1 billion, and said on Sunday it plans an appeal to the U.S. Court of Appeals for the Federal Circuit in Washington, D.C.

"The validity of the '218 patent has been upheld in previous litigation at the ITC and was affirmed by the U.S. Patent and Trade Office in the face of two separate challenges," it said. "We are confident that its validity will ultimately be upheld."

Kodak filed for Chapter 11 bankruptcy protection from creditors on January 19. Patent litigation has in recent years been a major part of the Rochester, New York-based company's strategy to generate revenue.

Apple's products include the iPhone, while RIM makes the BlackBerry.

Last month, Kodak won bankruptcy court permission to sell more than 1,100 digital imaging patents, roughly one-tenth of its patent portfolio, to help repay creditors as it shifts its business focus toward printing.

These patents are part of Kodak's digital-capture portfolio for devices such as digital cameras, smartphones and tablets. That portfolio has generated more than $3 billion in revenue since 2001.

Kodak has said it expects to hold the auction early next month.

Shares of Kodak closed Friday at 26 cents on the Pink Sheets.

The ITC case is In re: Certain Mobile Telephones and Wireless Communication Devices Featuring Digital Cameras, and Components Thereof, U.S. International Trade Commission, No. 337-TA-703. The bankruptcy case is In re: Eastman Kodak Co et al, U.S. Bankruptcy Court, Southern District of New York, No. 12-10202.

(Reporting by Jonathan Stempel, Editing by Gary Crosse)

By Jonathan Stempel

Sun Jul 22, 2012 2:55pm EDT