[Satellite News 02-21-12] ViaSat claims that Space Systems/Loral (SS/L) improperly filed patent applications for technology it didn’t own as far back as April 2007, according to lawsuit complaint documents filed earlier this month and obtained Feb. 21 by Satellite News.

   ViaSat filed the lawsuit in the United States District Court for the Southern District of California seeking monetary damages to compensate for the alleged theft of technologies contained in three ViaSat patents, as well as a permanent injunction to prevent SS/L and Loral from continuing to use ViaSat technology. The company said it was seeking a jury trial after it was unable to reach an out-of-court settlement in recent discussions with the manufacturer. The Southern District Court of California has named Larry Alan Burns as the presiding judge.

   ViaSat claims that SS/L, which built the company’s $400 million ViaSat-1 high-capacity Internet satellite, took its ideas for new satellite architecture and used them to win new satellite construction projects, including a deal with ViaSat competitor Hughes Network Systems. The lawsuit stated that the award of the ViaSat-1 contract was contingent on SS/L’s continued agreement to keep ViaSat’s revolutionary design and technology confidential and that the alleged misappropriation of its technology would provide SS/L with more than $1 billion in gains.

   “In June 2009, SS/L announced to ViaSat’s surprise that it was building a high capacity satellite at a price in excess of $200 million, named ‘Jupiter,’ for a direct competitor of ViaSat [Hughes],” ViaSat said in the lawsuit. “Jupiter’s design is almost identical to ViaSat-1. As a result of having its own technology used against it, ViaSat now stands to lose market advantage, including hundreds of thousands of customers that otherwise would have been customers on ViaSat-1 or subsequent ViaSat satellites.”

   The lawsuit also alleges that SS/L’s misappropriation of valuable technology was not limited to ViaSat. “SS/L also misappropriated a highly innovative utility gateway design patented by WildBlue and disclosed to SS/L under a confidentiality agreement,” said ViaSat. “Despite having received this proprietary information under terms of strict confidentiality, SS/L included this valuable feature in the Jupiter satellite as well. ViaSat is informed and believes that SS/L is preparing to take orders for additional high-capacity satellites incorporating ViaSat’s and WildBlue’s misappropriated technology.”

   ViaSat also believes that many, if not all, of the satellites constructed by SS/L after receiving its designs improperly incorporated its proprietary information and technology.

ViaSat President and COO Rick Baldridge confirmed that his company served the complaint for patent infringement and breach of contract against SS/L and Loral Space and Communications related to the unauthorized use of ViaSat’s intellectual property.

   “We believe our complaint clearly establishes our position regarding ownership of the underlying intellectual property as well as SS/L’s infringement of our patents and its breach of contract,” Baldridge said in a statement to Satellite News. “We have been clear with SS/L that any settlement discussions would need to progress expeditiously given the high stakes involved and the fact that we put SS/L on notice of these issues long ago. Unfortunately, those discussions didn’t progress at all, so we are moving forward with the litigation.”

   SS/L first received ViaSat’s designs in October 2006, at the start of its process to evaluate satellite manufacturers as candidates for the construction of ViaSat-1. The key components in discussion include: a satellite, which relays communications signals to and from the users and gateways; gateways, which control the satellite network and connect the satellite to the internet backbone; and indoor and outdoor user terminals connecting users to the satellite network.

   ViaSat claims that on Apr. 13, 2007, nearly seven months after it filed its initial patent applications, SS/L Employee Douglas Burr filed United States Provisional Application No. 60/923,263, entitled “Multi-Beam Satellite Network to Maximize Bandwidth Utilization.”

   “Mr. Burr was one of the lead engineers from SS/L on the ViaSat-1 bid team and project,” ViaSat said in the lawsuit complaint. “Mr. Burr also received confidential emails and other disclosures from ViaSat describing its 100+ Gbps satellite design throughout the bid process and construction of ViaSat-1 … Following its improper filing of the application in April 2007, Mr. Burr filed two additional related patent applications on behalf of SS/L: (1) United States Patent Application No. 11/891,086, entitled ‘Multi-Beam Satellite Network To Maximize Bandwidth Utilization’ in August 2007; and (2) United States Patent Application No. 12/861,702, entitled ‘Multi-Beam Satellite Network To Maximize Bandwidth Utilization’ in August 2010. On information and belief, SS/L misappropriated and misused information in breach of its confidentiality agreements by filing the ‘263 application and by filing and prosecuting the ‘086 application and the ‘702 application.”

   ViaSat’s relationship with SS/L was put under pressure last July, when the manufacturer discovered and reviewed a solar panel malfunction on the Telstar 14R satellite that delayed ViaSat-1’s scheduled launch. The discovery had prompted SS/L to conduct a failure review analysis of ViaSat-1 as it uses similar components.

   It was the second ViaSat-1 delay caused by SS/L. In January 2011, damage sustained to the ViaSat-1 satellite at its manufacturing facility forced ViaSat to push the launch back from spring to summer. ViaSat said an incident occurred while manufacturer Space Systems/Loral (SS/L) was transporting the Ka-band satellite for testing. SS/L agreed to cover the cost of the repairs. The Ka-band satellite was eventually launched on an ILS Proton rocket in October.

   ViaSat invested approximately $1 billion during the past three years hoping the satellite would make it into orbit by early August 2011. The satellite is a crucial element of the operator’s future growth strategy. Positioned in geosynchronous orbit at 115 degrees West, ViaSat-1 serves the U.S. market with nearly double the capacity offered by Eutelsat’s Ka-Sat satellite launched in December 2010. Loral Space and Communications is part owner of ViaSat-1 and has purchased pre-sold capacity on the satellite dedicated to Canadian consumer broadband providers. ViaSat-1 also is crucial to developing its valuable in-flight connectivity partnership with JetBlue Airways.

   ViaSat’s follow-up satellite ViaSat-2 is expected to launch in early 2015.