San Diego’s Mitek Systems, the developer of optical character recognition and intelligent pattern recognition technologies that processes 10 billion checks a year, might have created a new opportunity in the emerging market for mobile check processing. Today, the U.S. Patent and Trademark Office granted Mitek a utility patent for “systems for mobile image capture and processing of checks.”

A spokesman for the company, Jim Byrnes, tells me the patent covers Mitek technology that enables mobile users with camera-equipped smartphones, including the iPhone, BlackBerry, Android, and Windows Mobile, to use a picture of a check (front and back) to make check deposits. Byrnes says the patent issued today is Mitek’s seventh U.S. patent in image analytics and related fields; the company has five other patent applications pending.

Mitek Systems (OTCBB: MITK) CEO Jim DeBello, who joined the company about five years ago, was out of the country and unavailable for comment today. He outlined the company’s strategy for me earlier this year, though, saying Mitek’s “aha! moment” occurred two years ago—Use Mitek’s longstanding expertise in character recognition to “pivot” on the growth of smart phones. “We’re turning the camera on the smart phone into a virtual check scanner in your hand,” DeBello said. “What it’s meant for Mitek is essentially a transformation of skill sets.”

It’s an intriguing strategy and a compelling investor story. The question is whether Mitek can really pull it off. (Yesterday, the company posted a loss of $647,000, or 4 cents a diluted share, on revenue of $822,000 for the third quarter that ended June 30.)

Even though bookings were down in the third quarter, DeBello said in the company’s earnings report that Mitek has established itself as the “gold standard for … Next Page »

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Oracle (NASDAQ: ORCL), the Redwood City, CA-based database giant, filed a patent infringement complaint yesterday against Mountain View, CA-based Google (NASDAQ: GOOG) in the United States District Court for the Northern District of California. The suit alleges that the Android mobile device operating system developed by Google includes Java code that infringes on patents Oracle acquired when it purchased Sun Microsystems last year. (Android competes directly with Java, which is also used as an operating system on some phones.) The suit calls for an injunction against further distribution of Android, and asks for monetary damages “in amounts to be determined at trial.” Neither Oracle nor Google have commented publicly on the suit.

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San Diego-based Ethos Environmental said today it’s filed for patent protection of its Ethos FR+ fuel additive. Ethos says its fuel additive gives motorists increased fuel mileage, and at least a 30 percent reduction in emissions. The company says its additive was tested at the California Environmental Engineering lab, one of few labs certified by both the Environmental Protection Agency and the California Air Resources Board.

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At a moment when it seemed like the San Diego Chargers still had a chance to win Sunday’s NFL playoff game against the Pittsburgh Steelers, my daughter’s cell phone issued a high-pitched “beep-beep-beep.” Some guy named “Rio” in Pittsburgh sent a photo of a black Steelers helmet to her cell phone. The image was accompanied by an audio clip from a key scene in the movie “Anchorman: The Legend of Ron Burgundy” in which Will Ferrell’s anchorman concludes a newscast by reading aloud an epithet addressed to San Diego. The “f” word epithet.

This vignette came to mind while I was driving to the Del Mar office of Martin Cooper, who started the long march of innovation that has made such mobile wizardry possible.

Cooper is the inventor named on U.S. patent 3906166 for a “Radio telephone system.” He is known as the father of the cell phone, the inventor of the first portable wireless handset, and the first person to make a call on a portable cell phone—on April 3, 1973, from a street in New York City. At the time, he was working as a general manager in the communications systems division of a company called Motorola.

“They made car radios, that’s where the name came from,” Cooper told me after we sat down to talk. “The company was founded in Chicago in 1928. I remember that particular date because that’s the same year I was born.”

Cooper, who turned 80 last week, says journalists always ask about that first cell phone call. Their fascination with the call puzzles him a bit; he finds the technology and the corporate strategy more compelling. Yet he concedes the call was almost as significant a milestone as … Next Page »

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San Diego’s Qualcomm and Irvine’s Broadcom continue to exchange legal blows like a pair of prize fighters in a slugfest. In the latest round, Broadcom asked a federal judge in San Diego yesterday to declare that Qualcomm’s patents and patent licenses are unenforceable. Broadcom argues that Qualcomm’s sales and marketing practices constitute “patent misuse.” As a result, Broadcom contends the San Diego wireless giant has “exhausted” patents that control its post-sale use of products in the wireless communications industry. Qualcomm did not immediately respond to a request for comment. 

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[Story Updated 4:40 p.m. 6/18/06; see below]

If a Texas district court grants an injunction sought by Burlington, MA-based Nuance Communications (NASDAQ: NUAN), it could force Yahoo to shut down the voice-enabled version of its mobile search platform. The search tool is powered by software from Vlingo, a Cambridge, MA-based startup Nuance sued yesterday for alleged patent infringement.

The Yahoo (NASDAQ: YHOO) platform, called oneSearch with Voice, works on Blackberry Pearl, Blackberry Curve, and Blackberry 8800 series smartphones, and allows users to enter Web search queries such as “Boston Red Sox scores” or “United Airlines Flight 541″ simply by speaking them into the device. Vlingo’s deal to get its speech recognition technology included in oneSearch was seen as a major coup for the Harvard Square startup, which has about 35 employees and recently closed a $20 million Series B financing round led by Yahoo.

Nuance filed its lawsuit in the United States District Court for the Eastern District of Texas, a jurisdiction famous for favoring plaintiffs in patent-infringement cases. Xconomy obtained a copy of Nuance’s complaint. It alleges that Vlingo’s speech recognition software—including “without limitation, products and services Vlingo is supplying to Yahoo! oneSearch”—infringes on U.S. Patent No. 6,766,295, which was issued to Nuance engineers Hy Murviet and Ashvin Kannan in 2004. The patent covers a technique for making computerized transcription of a users’ speech more accurate over time using audio samples from multiple sessions such as phone calls.

The suit seeks unspecified monetary damages and attorney fees, and also asks the court to “preliminarily and permanently restrain” Vlingo and its business partners from making, using, and selling the allegedly infringing software. Those partners would presumably include Yahoo.

“Nuance has invested significant resources in developing technologies, building solutions and acquiring intellectual property,” Jo-Anne Sinclair, vice president and general counsel of Nuance Communications, said in a press release announcing the lawsuit. “These inventions and the intellectual property protecting those inventions are a cornerstone of our business. We take great pride in and place significant value on our patents and will aggressively protect our intellectual property rights through all available means.”

A spokesperson for Vlingo said that company executives were still reading through the lawsuit and were not ready to comment publicly.

While their technologies may or may not be similar, Nuance and Vlingo have definitely shared personnel. Vlingo’s chief technology officer and co-founder, Michael Phillips, is a former Nuance employee; he landed there in 2003 when Nuance (called Scansoft at the time) acquired Speechworks, a Boston-based MIT spinoff where Phillips was principal scientist. After Phillips left Nuance, he waited a year for his non-compete agreement with the company to expire before starting Vlingo, according to the Boston Globe.

(Full disclosure: Mike Phillips is brother-in-law to Greg Huang, Xconomy’s Seattle editor. Greg was not involved in the reporting, writing, or editing of this story.)

Update 4:40 p.m. 6/18/06:

Vlingo sent Xconomy the following response to Nuance’s lawsuit from Vlingo CEO Dave Grannan:

“We believe this lawsuit is unfounded. Nuance has referenced a patent that has serious limitations in its coverage. The patent does not apply to vlingo-developed technology nor the third-party licenses we employ; moreover, we have significant doubts regarding the patent’s validity. Industry observers will recognize this as typical counterproductive behavior of filing frivolous lawsuits in an attempt to stifle competition.

Vlingo will fight the lawsuit aggressively to its conclusion, while continuing to build on our tremendous momentum we’ve gained in less than one year since our public launch.”

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Last summer, the US Patent Office issued a package of new rules for patent applications. On Monday, the U.S. District Court for the Eastern District of Virginia decided to permanently block the changes.

The reactions from patent lawyers are mainly upbeat. “We are still dancing—it came out yesterday and we thought it was a cruel April Fool’s joke,” David Resnick, a partner at Nixon Peabody in Boston, told us in an e-mail yesterday. The Wall Street Journal’s Law Blog reports that “this morning, we were flooded with notes from patent lawyers who could barely contain their glee.”

The rejected rule package would have radically changed the way the U.S. patent system works. The goal was to ease the Patent Office’s workload, reduce its backlog, and speed up the review process, by limiting the number of claims and possible continuation applications. (Continuations contain additions to a patent’s original claims, or contest the office’s rejection of a patent.)

Big software companies have pushed the reforms. But in the pharma and biotech industry, the new rules met strong opposition. In these sectors it’s common to submit new empirical data from experiments and clinical trials in continuation applications.

Pharma giant GlaxoSmithKline and inventor Triantafyllos Tafus, founder of New Haven, CT-based biotech startup Ikonisys, both took the Patent Office to court to try to stop the proposal. On October 31, the day before the rules were going to be implemented, the Virginia court decided to put the whole package on hold. That preliminary ruling has now been confirmed.

But while this week’s decision is being called “permanent,” the Patent Office might still get its way. The Patent Baristas blog compares the Office with a B-movie villain who always comes back, and warns against premature celebrations.

The court’s decision can be found on the Patent Docs blog.

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Sirtris Pharmaceuticals (NASDAQ: SIRT) of Cambridge, MA, said today that the U.S. Patent and Trademark Office has issued to Sirtris the first patent ever granted for a class of compounds that activate SIRT1, a human enzyme that is the focus of much of the company’s research. In lab animals, Sirtris has found, activating SIRT1 lowers glucose levels and improves insulin sensitivity; the patent covers a potential Type 2 diabetes treatment that the company plans to test in human safety trials this year.

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