Ciena sues Nortel in fight over patents

THE BALTIMORE SUN

Ciena Corp. of Linthicum filed a federal lawsuit yesterday against Nortel Networks Inc. accusing the Canadian telecom giant of infringing on six of its patents.

The filing was made the day after a two-year legal cease-fire between the two companies expired - also ending talks in which the two companies were unable to reach a licensing agreement, Ciena said.

Ciena and Nortel "had agreed not to sue each other during a two-year period for patent infringement, with the idea that the two would each reach agreement on cross-licensing technology," said Nicole Anderson, a spokeswoman for Ciena. "After we were unable to reach that agreement, we took action to protect our intellectual property."

Nortel officials did not return telephone calls seeking comment. Tina Warren, spokeswoman for Brampton, Ontario-based Nortel, told Bloomberg News that the company had not seen the lawsuit and therefore could not comment.

Ciena and Nortel had agreed to the two-year moratorium on patent-infringement lawsuits as part of a January 2003 settlement of a patent-infringement suit filed by Nortel against a California company Ciena acquired, ONI Systems Corp. Ciena also agreed to pay Nortel $25 million.

In the settlement, Nortel gave Ciena a license under some patents and agreed to dismiss a separate lawsuit it had filed against Ciena.

Yesterday's suit, filed in U.S. District Court for the Eastern District of Texas, alleges that Nortel has been infringing on six Ciena patents, most of which involve fiber-optic-networking, and data-networking technology.

Anderson said that as part of the prior settlement, the two companies had agreed that any future patent-infringement suits would be filed in the Texas court.

Anderson said Ciena didn't expect the suit to come to trial until the middle of 2006.

Ciena's shares closed at $2.91, unchanged from Friday.

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