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Patent Win Buoys Northpoint

Northpoint Technology executives predict that a new patent covering a portion of the company's plan for an earth-bound competitor to satellite TV will bolster their lawsuit against a would-be rival.

Northpoint, which paid for and conducted research necessary to persuade the FCC to authorize a terrestrial microwave competitor to DBS and cable, is suing both the agency and competing applicant MDS America over plans to auction the necessary spectrum.

The most recent patent, granted Feb. 11, covers Northpoint's method for using direct-broadcast–satellite spectrum to transmit at power levels so low the signal won't interfere with DBS service. The spectrum is located on the 12 GHz band used by EchoStar and DirecTV. Those companies say the system, which would rely on microwave transmitters dispersed around the country, would wreak havoc on their customers' reception.

Northpoint argues that the patent and several others give it exclusive right to technology necessary to roll out the terrestrial pay-TV service without hurting DBS. MDS America, Northpoint says, has violated those patents in tests of its rival service and can't roll out a nationwide version without violating Northpoint's rights again.

Officials at the Washington-based company are particularly pleased by the latest patent because it was granted over MDS objections. Northpoint's rival had argued that much of the necessary technology for the service was already in the public domain.

"This is very strong vindication for our claim to have invented the technology," said Northpoint chief executive Sophia Collier. MDS officials deny the assertion.

The two companies will make their case to federal judges later this year. The federal appeals court in Washington has been holding in abeyance Northpoint's patent-infringement suit against MDS until the FCC wrapped up petitions to reconsider its terrestrial–pay-TV proceeding. Last week, the FCC reaffirmed its plan to permit the service and auction the necessary spectrum. Another Northpoint suit challenges the legality of the FCC auction.

Though the FCC said it planned to keep the June 25 auction date, a May 1 seminar for potential bidders was postponed indefinitely with no explanation. Sources predict the auction will be delayed and rescheduled after the cases are resolved.

At issue in the infringement case are patents that allow Northpoint to use DBS spectrum purportedly without creating interference to providers using it.

Northpoint's system is based on the principle that it can share spectrum with DBS by orienting its signal in the opposite direction. Other patents cover transmission of a terrestrial signal from a different compass point or elevation angle, as well as a plan to operate a terrestrial network in the presence of satellite signals and allow reception of local broadcast TV signals.