With one lawsuit settled, another begins

NASHUA, NH—The five-year battle between atomic force microscope (AFM) manufacturers Asylum Research Corporation (Santa Barbara, CA) and Veeco Instruments (based in Woodbury, N.Y. but with offices in Santa Barbara, CA) is over as of August 2008.

NASHUA, NH—The five-year battle between atomic force microscope (AFM) manufacturers Asylum Research Corporation (Santa Barbara, CA) and Veeco Instruments (based in Woodbury, N.Y. but with offices in Santa Barbara, CA) is over as of August 2008. The litigation began in September 2003, with Veeco Instruments alleging that Asylum’s MFP-3D AFM infringes on five patents owned by Veeco, in addition to other claims. Receiving news of the filing, Asylum immediately issued a statement denying that any Veeco patents are infringed in the manufacture of the MFP-3D, and adding that the company would vigorously defend itself—which it did over the years. Under the terms of the settlement, Asylum and Veeco have agreed to drop all pending claims against each other and agreed to a five-year, worldwide cross license of each other’s patents. They also made a mutual covenant not to sue on patents either party has a right to assert.

Asylum will pay an initial license fee to Veeco plus an ongoing royalty for the five-year term of the cross license. As part of the settlement, Asylum acknowledged the validity of the Veeco patents asserted in the case. Asylum CEO Jason Cleveland said the deal, “will allow both us and Veeco to bring better products to market.”

Meanwhile, National Laser Technology (NLT; Indianapolis, IN), a company that refurbishes and sells dental lasers to dentists in the U.S., has filed a lawsuit in the U.S. District Court for the Southern District of Indiana against Biolase Technology (Irvine, CA), which it says is damaging competition and affecting consumers in the hard-tissue dental-laser market. NLT is seeking compensatory and punitive damages, plus a preliminary and permanent injunction barring Biolase from engaging in anticompetitive conduct, making false and misleading statements, and retaliating.

The complaint alleges that Biolase, which reportedly has a market share of more than 85%, uses its competitive standing to coerce dentists to purchase products from Biolase at double the price offered by NLT. NLT alleges that as part of a campaign to put NLT out of business, Biolase threatens dentists by refusing to sell them laser tips and other necessary products if the dentists do business with NLT, and threatens to cut off trainers and other vendors who provide services to NLT customers. The complaint also asserts that Biolase has made false and misleading statements to dentists about NLT’s products.

“We have high-quality products to sell at low cost to compete with Biolase, but have been limited in our ability to provide these products to dentists because of the actions alleged in the complaint,” NLT CEO Alan Miller said. “We reluctantly brought this case because these actions have caused significant harm to NLT and to dentists.”

For its part, Biolase says that among other things, NLT sells used Biolase lasers—but is not an authorized Biolase dealer. “While NLT has yet to provide us with a copy of the complaint it filed against us, based on NLT’s press release … we believe that the allegations are frivolous and without merit. Biolase intends to defend the lawsuit vigorously, and will explore asserting appropriate claims against NLT,” said Biolase CEO Jake St. Philip. “We cannot guarantee the safety, effectiveness, or regulatory compliance of any used Biolase laser sold or modified by third-parties, and we will continue to work hard to protect dentists and patients, which is of the utmost importance to us.”

—Barbara Goode


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