Apple: Bankruptcy court should not decide Kodak patent interest issues

By Caroline Salls

Pittsburgh, June 6 - Apple Inc. objected to Eastman Kodak Co.'s motion asking the U.S. Bankruptcy Court for the Southern District of New York to order that Apple and FlashPoint Technology, Inc. have no interest in the patents held in Kodak's digital capture portfolio, according to a Tuesday court filing.

As previously reported, Kodak claims that Apple and FlashPoint are trying to "delay and derail" the company's efforts to sell the portfolio, which is a collection of patents that all relate to digital imaging.

The company calls the sale of the portfolio "a centerpiece of the debtors' reorganization efforts."

"The monetization of those patents is contemplated by the debtors' outstanding financing agreements and, as the debtors explained in their first day declaration, is critical to the debtors' successful reorganization. If the debtors can obtain a fair price for the digital capture portfolio, they could repay the debtor-in-possession financing and take a substantial step toward emerging from Chapter 11," the motion said.

In Tuesday's objection, Apple said Kodak's motion "disregards any notions of due process and fundamental fairness in seeking an unprecedented ruling on the merits of multiple causes of action and defenses that Apple has with respect to ownership of patents presently assigned to Kodak."

After having previously told the bankruptcy court that Kodak would see to it that Apple would have a fair hearing on these significant federal patent law inventorship and state law disputes, Apple said Kodak now wants to have these disputes resolved by the bankruptcy court on a summary basis without any pleadings, discovery, expert analysis, evidentiary proceedings or jury trial.

"As a result of Kodak's procedural maneuvers, Apple has not yet had an opportunity to pursue, nor even to fully plead, its assertions of rights in numerous patents presently assigned to Kodak," Apple said in the objection.

"Having created this situation, Kodak cannot now use the urgency of its Chapter 11 situation to ramrod through a procedurally flawed and substantively meritless motion on issues that require thorough analysis by a federal district court of competent jurisdiction.

"While Apple has the utmost respect for the bankruptcy court, Apple continues to believe that the district court is the proper venue to resolve these disputes, especially given the prominence of non-bankruptcy law in the disputes and the limits on the bankruptcy court's statutory and constitutional authority."

A hearing on Kodak's request is scheduled for on June 14.

Kodak is a Rochester, N.Y.-based imaging technology products and services provider to the photographic and graphic communications markets. The company filed for bankruptcy on Jan. 19. Its Chapter 11 case number is 12-10202.

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