A settlement with supplier Paice LLC means Toyota and Ford will continue to be able to produce and sell hybrid vehicles in the U.S.
Both the Ford Motor Co. and Toyota Motor Corp. have signed off on settlement with Paice LLC in a contentious patent dispute over hybrid technology.
Paice had charged both Ford and Toyota with violating a specific patent that it had owned since 1992. If the supplier’s suit had gone forward, it left open the possibility that the makers might have been barred from producing or selling their hybrid models in the U.S., including the top-selling Toyota Prius.
The terms of the agreement are confidential, though it appears to allow both makers to continue with their hybrid production and future gas-electric development plans. All lawsuits between the companies will be dismissed. Over the years, both Ford and Toyota had spent substantial sums trying to defeat Paice’s patent.
“I am happy that Toyota and Paice came to an amicable resolution on the use of my power-assisted engine invention,” said Dr. Alex Severinsky, who founded Paice in 1992. “We have long believed that hybrid vehicles represent the wave of the future for the auto industry and hope that consumers will continue to embrace hybrid vehicles as a meaningful way to reduce emissions.”
While Severinsky said the settlements vindicate his claim of having developed the modern hybrid-electric vehicle technology used in such products as the Prius, he also issued some conciliatory language recognizing Toyota’s contribution to the growing hybrid market.
“Although certain Toyota vehicles have been found to be equivalent to a Paice patent,” the supplier’s release stated, “Toyota invented, designed and developed the Prius and Toyota’s hybrid technology independent of any inventions of Dr. Severinsky and Paice as part of Toyota’s long history of innovation.”
The Toyota settlement follows by days Ford’s announcement that it had reached an agreement with Paice regarding the automaker’s use of the supplier’s license of its 1994 hybrid vehicle patent (U.S. Patent 5,343,970). Though details of this settlement also have been sealed, industry reports suggest Ford will now pay Paice a royalty on the sale of products such as the Fusion Hybrid and Explorer Hybrid.
“Paice is committed to the ongoing development of hybrid technology and selected research activities,” added Robert Oswald, president and CEO of Paice. “We will continue to pursue licensing agreements with other automakers which use hybrid technology patented by Paice.”
Paice LLC was formed in 1992 to develop hybrid vehicle technology that improves the fuel efficiency of internal combustion engines. Paice has obtained 11 U.S. patents and numerous foreign patents related to hybrid vehicle technology, including critical concepts related to the use of high voltage in a hybrid vehicle.