Dwinís Motion For Summary Judgement Of Non-Infringement Is Granted In Faroudja Case

A recent court order in the case of Faroudja Laboratories and Dwin Electronics may have significant implications on the design and manufacturer of line doublers, triplers, quadruplers and scalers, by other manufacturers seeking to design their products based on the three-two pulldown film-to-video telecine transfer process that converts film to video.On February 24, 1999, a United States District Court Judge granted Dwin Electronicsí motion of summary judgment of non-infringement in the case of Faroudja Laboratories vs. Dwin Electronics (Civil No. 97-20010 SW). The court held that no infringement by Dwin of U.S. Patent No. 5,876,596 (Faroudjaís key patent, covering all of their line multiplier and translator products) was demonstrated.Faroudja (Nasdaq symbol: FDJA) contended in their suit that Dwin, and by definition all users of Dwin products, were in violation of a process supposedly covered by patent ë596 (issued 1989). The court clearly pointed out that the film-to-video transfer process commonly known as three-two pulldown existed long before Faroudjaís patent issue and that in any case, Dwin line doublers and processors are not film-to-video transfer devices.In granting summary judgement of Dwinís motion, the court demonstrated ""the extreme degree of remoteness"" between Faroudjaís claim and Dwinís actual processes by paraphrasing with incredulity Faroudjaís basic premise:""Öif in 1979 a move production company decided to distribute one of its film in video format, it would convert the film itself or contract for its film to be converted. Twenty years later, if a person wished to view that movie using a Dwin line doubler to improve the image quality, he or she could rent the movie from any number of video rental stores. Faroudja would have the Court hold that when the person viewed the movie, the combination of the 1978 film-to-television transfer and the 1999 use of the line doubler result in infringement of the ë596 patent. Infringement would occur, according to Faroudja, even though the transfer step took place more than a decade before the ë596 patent even issued. Finding infringement under such circumstances would improperly expand the scope of Faroudjaís patent. There can be no finding of direct infringement resulting from the combination of such remote film-to-television signal transfers and Dwinís products.""Film-to-television transfer companies existed long before Faroudja applied for its patent. In drafting its patent application, Faroudja was free to include only those steps or means that actually improved the quality of images resulting from previously transferred signals. It did not do so, however, and for the Court to now find infringement by a process or device that does not include a transfer step or means would impermissibly extend coverage of the patent and improperly broaden its claims.""(Page 15 & 16, Section III, Order Granting Dwin Electronicsí Motion For Summary Judgement of Non-infringement Filed February 24, 1999, U.S. District Court, Northern District of California.)Dwin Electronics Inc., founded in 1982, is a Glendale, California-based manufacturer of CRT projectors and video processors for the consumer market. Recognized for its technological innovations, including Variable Line Multiplyingô, Dwin is currently the only CRT/Processor Company that designs and manufacturers all of its products in the United States.For more information contact Jeff Kida at 818 945 1608 or fax 818 956 0721. E-mail jeff@dwin.com.