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ITC to rule on automated trannie infringement claims

TROY, Mich. - A U.S. International Trade Commission (ITC) judge has made recommendations in favour of Eaton Corp. in an unfair import proceeding the company brought against ZF Friedrichshafen AG (ZF),...

TROY, Mich. – A U.S. International Trade Commission (ITC) judge has made recommendations in favour of Eaton Corp. in an unfair import proceeding the company brought against ZF Friedrichshafen AG (ZF), ArvinMeritor, Inc. and ZFMeritor LLC (ZFM) in December 2003.

Shortly after the decision, ArvinMeritor, ZF and ZFM vowed they would “pursue all possible means of appeal” adding that the decision covered only minor aspects of the transmission interaction with other systems.

On Jan. 7, 2005 the ITC made an “initial determination” that automated truck transmissions manufactured and marketed by ZF, ArvinMeritor and ZFM infringe an Eaton transmission patent and are being unlawfully imported into the United States.

The judge further recommended the ITC issue both an order prohibiting future importation of ZF FreedomLine transmission systems and components into the United States and a cease-and-desist order halting the sale of these products in the United States.

The initial determination is a recommendation by the (ITC) judge to the full commission. The commission will issue a final ruling in the coming months.

Meanwhile, ZF Friedrichshafen AG and ArvinMeritor Inc. have pledged to continue offering customers product choice, saying they have prevailed in 75 of 76 Eaton claims of patent infringement in the initial determination ruling.

“We will review the initial determination and pursue all possible means of appeal, and respond to the ruling to ensure that there continues to be a product choice in the North American heavy duty transmission market,” said Wolfgang Vogel, executive vice president, Commercial Vehicle Transmissions, and a member of the management board of ZF Friedrichshafen AG.

“We are confident, upon appeal, that we will have a different ruling, and that we will prevail in offering truck operators a proven choice of technology. Of the 76 claims in six patents asserted by Eaton, the judge found preliminarily that only one claim in one patent was infringed, and that one claim covered minor aspects of the transmission interaction with other systems,” said Tom Gosnell, president of ArvinMeritor’s Commercial Vehicle Systems business group.

According to Vernon Baker, ArvinMeritor vice-president and general counsel, the commission’s ruling can be appealed to the Federal Court of Appeals.

“There are still plenty of opportunities to be successful on behalf of our customers in this situation,” he said. Since 1997, Eaton has filed three patent actions against ArvinMeritor and ZF, including the present ITC action.

In 1997 Eaton made an initial filing that forced ZF Meritor – a joint venture created in 1999 between ArvinMeritor and ZF, to remove its Engine Synchro Shift (ESS) transmission system from the market, following the initial verdict in the competitor’s favour.

In 2003 ArvinMeritor won an appeal in the patent infringement suit. The Court of Appeals for the Federal Circuit reversed the decision of a Delaware trial court and found that ArvinMeritor did not infringe on the Eaton patent.

The court then narrowed Eaton’s patent interpretation so that it could not apply to ArvinMeritor’s ESS transmission or any other transmission that did not contain the structures listed in the patent claim.

ArvinMeritor and ZF later prevailed against Eaton in a Patent Office action to wrest ownership of ArvinMeritor’s torque prediction patent. Subsequently, in 2004 ArvinMeritor filed a patent infringement lawsuit in North Carolina against Eaton for infringement of its U. S. Patent covering torque prediction.

ArvinMeritor says that this patent is infringed by every Eaton automated manual transmission.

ArvinMeritor offers transmission products produced by its ZF Meritor joint venture: 9-, 10-, and 13-speed manual transmissions, as well as the ESS, SureShift and FreedomLine automated manual transmissions for heavy-duty Class 8 trucks. Eaton Corporation creates powertrain solutions and specialty controls and intelligent truck drivetrain systems.

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