3d loses lawsuit to EOS

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Date: Sun Sep 14 2003 - 19:10:08 EEST

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Court Rules that 3D Systems Infringes EOS Patent Rights

MUNICH, Germany, Aug. 26 /PRNewswire/ -- The United States District Court for
the Central District of California has ruled that the Sinterstation and
Vanguard laser-sintering systems manufactured and sold by DTM Corporation infringe
patent rights held by EOS GmbH of Munich, Germany. 3D Systems of California
(Nasdaq:TDSC) acquired DTM in August 2001 and is therefore liable for any
damages. The Court also ruled that the powder patent which 3D Systems had asserted
against EOS in a counter-claim cannot be construed, meaning that the patent is
effectively invalid and cannot be enforced against EOS.

The Court orders were issued as a result of a Markman hearing and various
motions for summary judgment in the patent infringement lawsuit which EOS filed
against DTM in December 2000, and to which 3D Systems subsequently became a
party. EOS had filed two motions for summary judgment, both of which have been
granted, while 3D Systems and DTM had filed four motions for summary judgment,
all of which have been denied by the court.

EOS is asserting 14 patents against the DTM machines, 13 of them licensed
from 3D Systems. To simplify matters, EOS had selected one example, claim 4 of US
Patent No. 5,630,981 (the '981 patent), and asked the Court to decide in
summary judgment whether this was infringed. In interpreting the disputed terms in
the patent claims, the Court ruled that the term "stereolithography" is not
limited to liquids cured by UV illumination but can properly apply to the use
of materials formed into a solid by other (non-UV) radiation. In its
conclusion, the Court found that the DTM machines contain every element in Claim 4 of
the '981 patent and that they therefore infringe the patent. This infringement
ruling applies to every Sinterstation and Vanguard system sold by DTM since
August 1997, when EOS acquired the exclusive rights to all 3D Systems patents for
the field of laser-sintering. EOS has estimated that the damages from this
infringement amount to at least $40 million dollars, and asserts that DTM's
infringement was willful. In one of its rulings, the Court refused DTM's motion to
rule that the infringement was not willful. If willfulness is found, the
Court may increase damages by up to three times.

In a counter-claim, 3D Systems had asserted that certain nylon powders which
are sold by EOS in the U.S.A. infringe DTM's US Patent No. 5,990,268 (the '268
patent). However the Court has found that this patent contains multiple
conflicting definitions of a key term of its claims and cannot be construed,
therefore EOS cannot infringe this patent. 3D Systems had previously gone to Court
twice to try and prevent EOS from selling its high-quality laser-sintering
powders in the U.S.A., in both cases also unsuccessfully.

"We are very pleased with these rulings," stated Dr. Hans J. Langer, founder
and Chief Executive Officer of EOS. "The infringement ruling should be no
surprise to 3D Systems, as it simply confirms what they told us in writing in 1997
when we were negotiating the license agreement. We find it very regrettable
that having sold their laser-sintering rights exclusively to EOS, 3D Systems
then decided not only to enter the laser-sintering market in breach of their
agreements, but also to pursue legal action against EOS. With these new rulings
it is very clear who is infringing who's patent rights. We hope that the whole
litigation can now be ended quickly, and we are confident in our position. In
the meantime we will continue to focus our resources on developing and
marketing application-optimized laser-sintering solutions. In the first half of 2003
we sold nearly twice as many laser-sintering systems as any other company,
which confirms that we have been following the right strategy. Our
laser-sintering business has also been growing strongly in the United States, both regarding
powder materials and system sales."

About EOS

Founded in 1989, EOS is today the world leader in laser-sintering.
Laser-Sintering is the key technology for e-Manufacturing(TM), the manufacture of
products, patterns or tooling for every phase of the product life cycle directly
from electronic data. Innovative companies from various industrial sectors use
this technology to accelerate their product development and streamline their
production processes to strengthen their competitive edge.

Headquartered in Munich, EOS has subsidiaries and distribution partners all
over the world. EOS generates an annual turnover of about 40 million Euro. The
EOS patent portfolio includes more than 140 granted patents resulting from own
inventions as well as licences to numerous patents from other companies,
including the worldwide exclusive licence to all patents held by 3D Systems of
Valencia, California, for the field of laser-sintering.


CO: EOS GmbH; DTM Corporation; 3D Systems

ST: Germany, California


Web site: http://www.eos.info

08/26/2003 07:06 EDT

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