Bitter fight over EGPWS patents triggers full-scale war of words

 - January 9, 2008, 5:43 AM

The legal battle over EGPWS patents between Honeywell and competing manufacturers of TAWS avionics has stretched the limits of civil debate as executives on both sides of the imbroglio now find themselves locked in a war of rhetoric aimed at telling why the other side is wrong.

Among the biggest questions at this point centers on how a fight over intellectual-property rights will play into customers’ decision-making as it relates to the FAA’s TAWS equipment mandate in March 2005. The sale of TAWS avionics means big money to manufacturers and dealers–to the tune of about a half-billion dollars for the required hardware in addition to the cost for installations. With so much at stake, the rancor at times has gotten downright ugly.

Aircraft operators affected by the new rules are compelled to buy and install terrain awareness and warning systems whether they like it or not. Many already have, but thousands more are still waiting in line to purchase the needed avionics. As a result installers are preparing for a flood of business in the next 24 months, and the manufacturers are positioning themselves to compete in bids for lucrative fleet orders.

The four rival manufacturers named in two Honeywell lawsuits filed last spring and summer hope to grab as much market share as possible while they still have the chance. Each of the companies–Goodrich, Universal Avionics, Sandel and ACSS–are trying to convince buyers to choose their systems over Honeywell’s EGPWS, an exercise that to a certain extent has had to involve quelling concerns about the possible fallout from the patent lawsuits.

Universal, ACSS and Sandel each have offered some form of official comment on the matter. At press conferences or in press releases, they have accused Honeywell of seeking an illegal monopoly in the TAWS market and misleading FAA officials. Sandel president Gerald Block was the first to hold a press conference–at EAA’s AirVenture fly-in in Oshkosh, Wis.–last summer, during which he strongly refuted the lawsuit’s claims. Universal Avionics then issued a sharply worded press release at the NBAA Convention announcing a counterclaim against Honeywell for, among other things, “sham lobbying” of the FAA. Finally, in October ACSS, through its minority stakeholder Thales, fired off a letter to Honeywell warning it to stop infringing 20 of Thales’ TAWS-related patents–after which Thales supplied details of the letter in a press release of its own.

Defending Patents
Accusations of heavy-handed tactics have infuriated Honeywell executives, who argue that the lawsuits are meant to address what they see as blatant patent infringement and nothing more. They express dismay at suggestions their company has done anything even marginally outside the lines.

Frank Daly, president of Honeywell’s air transport avionics division, said Honeywell invented EGPWS and has every right to protect that multi-million-dollar investment. Competitors, he claimed, have in essence stolen key parts of the concept, applied them to their own TAWS designs and called these products new.

“We spent a substantial amount of time and money developing EGPWS,” said Daly. “I’m offended by the whole notion that we’re the ones who have done something underhanded.”

Last September Universal Avionics alleged in public filings with the U.S. District Court
in Delaware that Honeywell used deception to get the FAA to require TAWS specifications that closely resembled features found in EGPWS. Executives for Universal claimed that Honeywell applied for its patents before the FAA first proposed the new rules in spring 1998, but that it never revealed the existence or makeup of those patents to the agency. Honeywell views the issue from a starkly different perspective.

“This is just nonsense,” said John Donofrio, Honeywell vice president and general counsel. “The patents at issue in the lawsuits were public at the time we were working with the FAA. It’s so silly to say we hoodwinked the FAA. Everybody knew about these patents.”

The FAA has taken the position that Honeywell did nothing wrong in helping to set
the rules for the TAWS mandate, and has further stated that at no time during meetings with the agency to formulate the TAWS mandate was Honeywell required to reveal it had filed EGPWS patents. The FAA has no plan to involve itself in the legal battle, according to a spokesman, who added that the agency’s responsibility rests in improving air safety, not presiding over product disputes.

Still, Honeywell’s competitors continue to maintain that the five EGPWS patents at issue are not valid, first because they include specifications included in a mandated rule and second because they had not been made fully public at the time the TAWS rules were being written.

Daly labeled those assertions absurd: “Does anyone really believe, given Honeywell’s almost 40 years of leadership in this industry–the hundreds of people we’ve got employed working on it, the six industry meetings we held, the hundreds of patents we’ve filed over the years–that anyone was surprised that Honeywell filed for patent protection on this invention? Could anybody credibly stand up and say that? I’d like to meet that person.”

The five patents at issue are split into three groups, the first covering the way EGPWS visually portrays position information on a cockpit display, the second dealing with the way information pops up on the display when terrain becomes a threat and the remaining three relating to the complex mathematical algorithms that calculate the distance between the aircraft and terrain and the precise evasive action that a pilot would need to take to avoid hitting the ground.

Among the more contentious of the claims are those included in the display-related patent. These would seem to prevent competing products from using the colors red, yellow or green on the TAWS display or storing terrain information in a database–leading to the question of whether it would even be possible to develop an FAA-approved TAWS that does not violate a Honeywell patent. Daly claimed it would be possible, if the display used only monochromatic colors and if terrain information was gathered through some alternate means, say, a forward-looking infrared sensor that scans for dangerous topography ahead of the aircraft.

That, say rivals, begs the question of whether anybody would even want to buy such a system.

If you happen to be a flight department manager or chief pilot whose aircraft are equipped with a TAWS device from one of the companies Honeywell is suing, you may have wondered whether you will still be permitted to fly with those systems or can expect to receive adequate product support should Honeywell ultimately win its case. On the other hand, if you’re an avionics installer you probably have been confronted with questions from business jet operators about what equipment they should buy.

The reality is that once a competitor’s system has been installed in an aircraft no one could force the operator to take it out. However, if Honeywell prevailed and the competitors were no longer able to build their current TAWS products, who would support them? Might Honeywell provide competitors with licenses that would allow TAWS makers to continue selling their systems?

Honeywell does not rule out the possibility for future licensing agreements, but it is adamant that competitors would have to take their present products off the market without such an agreement. Its position is that Goodrich, Universal, ACSS and Sandel are infringing EGPWS patents, and the right thing to do is to stop marketing and selling those products.

“This is an example of the patent system working the way it’s supposed to work,” said Donofrio. “The patent system here in the United States, and in every country, is designed to encourage innovation. People innovate by putting in their own resources–time and money–and then they patent the results. We put over 30 years of work into what is now EGPWS, totaling more than $100 million. That’s a substantial investment. We’re just protecting that investment.”