October 19, 2021

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Autostore's patent dispute could lead to a $170 million attorney bill - E24

Autostore’s patent dispute could lead to a $170 million attorney bill – E24

The Norwegian robot company must provide large sums to lawyers in a patent dispute with Britain’s Ocado.

XXL ROBOTS: The Norwegian sports series XXL has used Autostore solutions for over ten years. Robots roam on an aluminum frame and pick up goods for employees in the warehouse.

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What began with Autostore suing Ocado for patent infringement in October last year has since followed by Ocado counterclaims and several lawsuits in an all-out legal battle.

Ocado is one of the largest online grocery players in the world.

Autostor is now in the process of being listed in Oslo, and in that respect it gives investors insight into the size of the presumed attorney’s bill.

The listing document states that Autostore envisages lawsuit expenses between $15 and $20 million. At current exchange rates, this corresponds to a bill of between 128 and 170 million NOK.

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According to the document, the company did not make any provisions other than legal expenses.

Geir Bjørlo, investor contact at Autostore, writes in an email that they have a limited opportunity to provide more information, other than what is stated in the prospectus, up to the listing.

Autostor is confident of winning cases, and in general the costs of litigation are on par with other similar international legal processes, Biorlo writes.

Autostore creates automated storage and picking systems for warehouse owners and operators. The company has been working with technology since 1996.

Lawsuits and corresponding lawsuits

The lawsuit against Ocado was filed in the United States and the United Kingdom in October 2020.

The allegation is that the court stopped Ocado and its partner Tharsus Group from importing, using and selling technology that Autostore believes infringes the company’s patents.

Autostore also requires financial compensation from Ocado.

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E24 was previously in contact with Ocado regarding the lawsuit.

Any suggestion that we took away their intellectual property is absurd. A spokesperson for Ocado said in November of last year that these inventions are ours and we will continue to protect our intellectual property by all necessary means.

In January and March, Ocado filed lawsuits in the United States, the United Kingdom and Germany.

Ocado is an online technology company and London FTSE 100-listed grocery supplier. The company has entered into an agreement with grocery and retail chain Marks & Spencer.

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The Autostore system is based on robots that pick merchandise. It is used by retail chains Asda in the UK and Best Buy in the USA, as well as Lufthansa in Germany.

Autostore says Ocado has been a customer of the Norwegian company since 2012.

Waiting for a “positive result”

In the prospectus, Autostore wrote that the company expects a “positive outcome” to the dispute, and points to its patent rights to the robot technology.

The company believes that a court ruling will result in “increased licensing income, increased sales and/or compensation,” but stresses that the process is fraught with uncertainty and “can be very difficult to predict.”

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The prospectus lists several possible alternative outcomes of the lawsuits.

Among other things, parts of the two companies’ patents could end up being cancelled, an outcome that Autostor still believes will benefit financially.

Less preferred results are also listed:

  • The document notes that a “worst-case” scenario is that Ocado will invalidate Autostore’s patents, which could affect the company’s sales.
  • If Autostore is unsuccessful in a UK patent infringement case, Autostore will likely pay the other party legal fees, but not compensation, according to the prospectus.
  • If Autostore is found guilty of violating US competition law, the company could face penalties, it has been pointed out.

Autostore writes that “a worst-case scenario is currently considered unlikely, but should such a scenario occur, the group still has a strong patent portfolio.”

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