Toyota Hybrids Facing US-Market Ban?

Bloomberg reports that the US International Trade Commission has launched a probe of alleged patent violations which could result in the banning of all Toyota hybrids from the US market. Paice LLC won a 2005 civil suit against Toyota, in which Paice’s founder Alex Severinsky sought a court order banning the sale of Toyota’s Prius, Highlander and Lexus RX400h hybrids. Instead, an appeals judge awarded Paice $4.3m in damages, and ordered Toyota pay Paice a $100 royalty per hybrid sold in the US. In the current case before the ITC, Paice claims that Toyota’s Camry, third-generation Prius, Lexus HS250h sedan and Lexus RX450h are “are materially the same” and violate the same patents as those in its first case. If Paice can convince the ITC that Toyota indeed violated its patents, he will still need to prove that the little-known company has a market to protect. But Paice doesn’t actually want Toyota to be banned from selling cars. In the words of one patent attorney, an “injunction would have given Paice strong leverage to negotiate a lucrative licensing deal with Toyota…Paice always felt that their technology was worth a lot more than [$100 per car] to Toyota.”

Independent patent lawyer Michael Murphy explains Toyota’s patent violation thusly:

At its heart, it’s the cooperative dual management of the internal combustion and the electric motor. Either one is a candidate at any time for providing some of the torque or all of the torque needed to spin the drive wheels. What Paice says is its real innovation is in the fusing of the two, the seamless management of torque from either or both drive inputs….

If all you were doing was switching from an electric mode to a gas mode, you wouldn’t have infringement. In other words, you wouldn’t have infringement if you made a crude hybrid system that said we’re either running on batteries or we’re running on the gas engine, but never both.

The real point of [Paice’s claimed] sophistication is where you get torque. It may be, under certain conditions, it’s more efficient to get torque from the electric motor. Under other conditions, it’s more efficient to get that from the gas engine. And under other conditions, you want to seamlessly blend torque from both sources.

[Paice would] say their microprocessor-based controller looks at engine speed, motor speed, battery voltage, battery charge, ambient temperature, acceleration, direction, deceleration—all of those things—to make a decision about how much of the torque should be supplied by the engine versus the electric motor. That’s the heart of it. If it was an either-or system, Toyota wouldn’t be in court. Also, it wouldn’t be a very efficient hybrid system.

Read a complete interview with Murphy at hybridcars.com.