Court Rules that 3D Systems Infringes EOS Patent Rights

MUNICH, Germany, Aug. 26 /PRNewswire/ -- The United States District Court for the Central District of California has ruled that the Sinterstation and Vanguard laser-sintering systems manufactured and sold by DTM Corporation infringe patent rights held by EOS GmbH of Munich, Germany. 3D Systems of California acquired DTM in August 2001 and is therefore liable for any damages. The Court also ruled that the powder patent which 3D Systems had asserted against EOS in a counter-claim cannot be construed, meaning that the patent is effectively invalid and cannot be enforced against EOS.

The Court orders were issued as a result of a Markman hearing and various motions for summary judgment in the patent infringement lawsuit which EOS filed against DTM in December 2000, and to which 3D Systems subsequently became a party. EOS had filed two motions for summary judgment, both of which have been granted, while 3D Systems and DTM had filed four motions for summary judgment, all of which have been denied by the court.

EOS is asserting 14 patents against the DTM machines, 13 of them licensed from 3D Systems. To simplify matters, EOS had selected one example, claim 4 of US Patent No. 5,630,981 (the '981 patent), and asked the Court to decide in summary judgment whether this was infringed. In interpreting the disputed terms in the patent claims, the Court ruled that the term "stereolithography" is not limited to liquids cured by UV illumination but can properly apply to the use of materials formed into a solid by other (non-UV) radiation. In its conclusion, the Court found that the DTM machines contain every element in Claim 4 of the '981 patent and that they therefore infringe the patent. This infringement ruling applies to every Sinterstation and Vanguard system sold by DTM since August 1997, when EOS acquired the exclusive rights to all 3D Systems patents for the field of laser-sintering. EOS has estimated that the damages from this infringement amount to at least $40 million dollars, and asserts that DTM's infringement was willful. In one of its rulings, the Court refused DTM's motion to rule that the infringement was not willful. If willfulness is found, the Court may increase damages by up to three times.

In a counter-claim, 3D Systems had asserted that certain nylon powders which are sold by EOS in the U.S.A. infringe DTM's US Patent No. 5,990,268 (the '268 patent). However the Court has found that this patent contains multiple conflicting definitions of a key term of its claims and cannot be construed, therefore EOS cannot infringe this patent. 3D Systems had previously gone to Court twice to try and prevent EOS from selling its high-quality laser-sintering powders in the U.S.A., in both cases also unsuccessfully.

"We are very pleased with these rulings," stated Dr. Hans J. Langer, founder and Chief Executive Officer of EOS. "The infringement ruling should be no surprise to 3D Systems, as it simply confirms what they told us in writing in 1997 when we were negotiating the license agreement. We find it very regrettable that having sold their laser-sintering rights exclusively to EOS, 3D Systems then decided not only to enter the laser-sintering market in breach of their agreements, but also to pursue legal action against EOS. With these new rulings it is very clear who is infringing who's patent rights. We hope that the whole litigation can now be ended quickly, and we are confident in our position. In the meantime we will continue to focus our resources on developing and marketing application-optimized laser-sintering solutions. In the first half of 2003 we sold nearly twice as many laser-sintering systems as any other company, which confirms that we have been following the right strategy. Our laser-sintering business has also been growing strongly in the United States, both regarding powder materials and system sales."

About EOS

Founded in 1989, EOS is today the world leader in laser-sintering. Laser-Sintering is the key technology for e-Manufacturing(TM), the manufacture of products, patterns or tooling for every phase of the product life cycle directly from electronic data. Innovative companies from various industrial sectors use this technology to accelerate their product development and streamline their production processes to strengthen their competitive edge.

Headquartered in Munich, EOS has subsidiaries and distribution partners all over the world. EOS generates an annual turnover of about 40 million Euro. The EOS patent portfolio includes more than 140 granted patents resulting from own inventions as well as licences to numerous patents from other companies, including the worldwide exclusive licence to all patents held by 3D Systems of Valencia, California, for the field of laser-sintering.

CONTACT: Elke Fritz, Email Contact, +49-89-893-36-232, fax,
+49-89-893-36-288, for EOS GmbH * Electro Optical Systems

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