Thales plots retaliation for Honeywell's lawsuit

 - May 7, 2008, 7:33 AM

Thales Avionics has threatened legal reprisals against Honeywell unless the U.S. avionics and engines giant drops a patent-infringement lawsuit against Phoenix-based Aviation Communication & Surveillance Systems (ACSS), a maker of terrain awareness and warning systems (TAWS), TCAS and mode-S transponders, jointly owned by Thales and L-3 Communications.

In a letter to Honeywell last month, Thales issued a sharply worded warning that if Honeywell continues its alleged “unlawful practice” of using the former’s patents in the latter’s Enhanced Ground Proximity Warning System (EGPWS) the French company plans to file a series of patent-infringement lawsuits against Honeywell in U.S. and European courts.

In a press release issued after the letter was sent, Thales said it has demanded that Honeywell imediately stop infringing “several” patents related to the French firm’s Ground Collision Avoidance System (GCAS), originally developed as a terrain-following device in Dassault fighters and now being developed as a TAWS by ACSS for civil aircraft.

A Thales spokeswoman said the company’s threat of legal action is a direct response to Honeywell’s patent lawsuit filed earlier this year against ACSS alleging that the version of GCAS now under development infringes EGPWS patents.

Thales and Honeywell, in settling a separate unrelated lawsuit, entered into a confidential written agreement whereby any business disputes, including patent-related issues, would be settled privately, the Thales spokes- woman claimed. She said senior executives at Thales now consider Honeywell in violation of that agreement, adding that one way for Honeywell to avoid lawsuits by Thales would be for the U.S. company to “honor the agreement” and drop its case against ACSS.

Making it clear that Honeywell at this time has no intention of withdrawing its lawsuit, a Honeywell spokesman acknowledged receiving a letter from Thales, calling it retaliatory in nature and containing the specific threat of legal action against Honeywell for alleged GCAS patent violations. He added, “We firmly believe there is no merit to these claims.”

The spokesman went on to acknowledge the existence of the written agreement that the Thales spokeswoman claimed protects each company from legal action brought by the other, but he said only that Honeywell “has an agreement with Thales that was signed as part of the settlement of a previous lawsuit.” Both Honeywell and Thales, he said, are “prohibited from disclosing the provisions of the agreement, and Honeywell intends to honor this commitment.”

The Honeywell spokesman concluded, “EGPWS and its predecessor products have been on the market since the 1970s and the first time Thales raised any infringement allegations was two weeks after the filing of Honeywell’s lawsuit. This is not a coincidence. Their action is clearly a retaliatory charge designed to detract from the merits of the litigation.”

Honeywell has filed patent-infringement lawsuits against four TAWS makers, a list that in addition to ACSS includes Goodrich, Universal Avionics and Sandel. Honeywell attorneys have requested a jury trial in U.S. District Court in Delaware, which in the case of the latter three defendants is scheduled to begin next fall. ACSS has been sued separately from the others, for reasons that have not been made entirely clear. An ACSS spokesman claimed the motive behind the disparity in filing dates is that Honeywell is less confident it can win its case against ACSS.

In the meantime, Universal Avionics has filed a counterclaim against Honeywell alleging that its cross-state rival has engaged in patent misuse, customer intimidation and “sham lobbying” of the FAA and European Commission. Universal is seeking triple damages under the Sherman Antitrust Act, as well as unspecified compensatory and punitive damages.

Honeywell has rejected Universal’s claims, countering that the assertions presented in that case were “merely baseless attempts to evade the central issues in our patent-infringement lawsuit.”

Lawyers and analysts familiar with the gathering battle over TAWS patents said the case could have an effect on the scheduled implementation date of an FAA mandate requiring installation of TAWS equipment in thousands of turbine-powered airplanes by March 2005. An FAA spokesman said the agency does not plan to get involved in the legal rankling, pointing out that the job of the administration is to improve air safety, not monitor competitive disputes in the avionics industry.