Apple Fails to Move Kodak Patent Case Out of Bankruptcy Court

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On Thursday, Apple Inc lost its attempt to move its patent dispute with Eastman Kodak out of the bankruptcy court. U.S. District Judge George Daniels in Manhattan quashed Apple’s petition and declined to take up the patent dispute instead of allowing the duly assigned bankruptcy judge to decide the matter.

Last month, Kodak filed a lawsuit in the U.S. bankruptcy court in Manhattan alleging that Apple had wrongly claimed ownership of 10 patents arising from work that the companies developed together in the early 1990s. Another privately held company spun off from Apple in 1996, FlashPoint Technology, had also claimed the patents through an assignment from Apple, and is named as a defendant.

The dispute is over vital patents that help camera owners to preview photographs on LCD screens.

  

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Kodak claimed that the patents are a part of the company’s digital capture portfolio, which includes more than 700 patents for devices such as smartphones, tablets and digital cameras, and has yielded more than $3 billion in revenues since 2001. Before the bankruptcy judge, Kodak has claimed that Apples claims to the patents are time-barred and are designed to thwart the expected auction of Kodak’s patents scheduled in early August. The bankruptcy judge, Groper, has not yet ruled in the matter.

At the end of Thursday’s hearing, District Judge George Daniels agreed with Kodak in maintaining that the dispute should remain in bankruptcy court, or at least until the bankruptcy judge rules on some key issues. The court mentioned, referring to the bankruptcy judge, that he should have “an opportunity to render a decision on the motion and to have an opportunity to control and move forward the process.”

Apple argued that the dispute involved substantive knowledge of patent law and should be decided by a federal district judge.

Kodak had filed for Chapter 11 bankruptcy protection on January this year.