Hearing on patent breach scheduled for November 24th

Cervelo and Canyon GmbH to meet in court next week – firm clarifies web rumour

Peter Donato, Cervelo’s director of public relations has contacted BikeBiz this week in the hope of ‘setting the record straight’ on a number of reports appearing on the web relating to a hearing due for court next week. Scheduled for November 24th, Cervelo will meet Canyon GmbH in court over a patent dispute.

Donato told BikeBiz:

"An article featured Bike Europe in the past week concerning an ongoing patent dispute of Canyon GmbH against Cervélo Cycles Inc. and TriDynamic contains some errors that demand clarification.

"Contrary to the statements in the article, the main hearing with the European Patent Office has not even occurred yet. It will be held on 24 November. There are also other actions available to Cervélo in trying to correct the issuance of the patent. When the patent is ultimately withdrawn, or invalidated there will no longer be a basis for a court decision against Cervélo and TriDynamic.

"There are a number of other issues which we feel are important to address:

"Cervélo discontinued doing business with Peter Seyberth and TriDynamic in August of 2009 as a result of what we believed were serious irregularities in his business practices. Cervélo presently has a legal action against TriDynamic and Peter Seyberth for funds which are believed to have been withheld while he was the Cervélo Distributor. It may be appropriate to see some of TriDynamic’s statements regarding Cervélo and its products in this light.

"As most of you are aware Cervélo Cycles Inc. and TriDynamic are in an ongoing patent dispute with Canyon GmbH. Canyon had been granted a patent in Germany for a particular seat tube shape and has taken legal action against Cervélo and TriDynamic in the German court for patent infringement. The law suit deals with the older R-models (R3, RS and R3SL frames). The completely new 2011 R-models with the BBright innovation are not affected.

"Cervélo has responded by defending in the German court and more importantly, filing an opposition to the patent with the European Patent Office.

‘Cervélo believes very strongly that the patent should be invalid due to prior use and obviousness. It is a combination of features which is believed to be known publicly for many years before the patent application and more recently in very common use by many manufacturers.

"In fact, although the new Cervélo R-models with BBright do not use this combination of features, many other frames on the market do appear to and thus would also be at risk.

"Initially, Cervélo included TriDynamic in the defence in the German court, but public statements by Peter Seyberth were disruptive and unnecessary, and have made a common defence difficult. As a result of this untenable relationship, the German law firm withdrew their representation of TriDynamic after the German lower court decision in September and advised him immediately.

"As a result of Cervélo’s appeal of the court decision, the requirements of the decision were not automatically enforceable against Cervélo. Canyon has exercised its right to enforce part of the decision in demanding certain information from Cervélo.

"TriDynamic did not appeal the court decision and therefore the court order is immediately enforceable against them. This requires both the information about orders and sales and the request to dealers to return frames they still have in stock (the recall). That only applies to R3, RS and R3SL frames sold by TriDynamic since 1 September, 2008. It is a request to dealers. Dealers were not named in the action, there is no court order against them and they are not obliged to comply with the request.

"Currently this issue only applies to Germany, where the patent was issued, and of course Cervélo strives to minimize the issue for its dealers. Regardless of the outcome, this issue is not expected to have a material financial impact on Cervélo."

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