Neology vs. Federal Signal- Likelihood of Success on Merits but No Preliminary Injunction

Neology announced that Magistrate Judge Mary Pat Thynge of U.S. District Court of Delaware issued a Report and Recommendation ("Report") with respect to Neology's request for a preliminary injunction in connection with Neology's case asserting patent infringement by Federal Signal Corporation, et al ("FS"). Neology contends that ten FS products infringe one or more of more than 30 claims related to six Neology U.S. patents. Judge Thynge did not grant a sought-for preliminary injunction immediately prohibiting the sale of products employing the disputed technology; however, the Report did support Neology's assertions in the litigation that its patents were both valid and infringed by FS. The Report stated that "Neology has demonstrated a likelihood of success on the merits," due to FS' failure "to raise a substantial question concerning either infringement or validity."

Francisco Martinez, Neology's Chief Executive Officer, noted, "We understood the difficulties in our motion due to the high legal standard for obtaining a preliminary injunction. However, we are extremely pleased that the Judge's Report commented favorably vis-a-vis our central assertion that FS' 6C tags, readers and systems infringe our patents. We continue to maintain that our patent portfolio is fundamental to our competitive position and we will do whatever is necessary to protect our valuable intellectual property. With Judge Thynge's findings, we feel more confident than ever that we will prevail at trial with respect to the central issues in this case. We seek both to obtain a permanent injunction against FS' infringing products and to recover substantial and material damages we have suffered from FS' infringement of Neology intellectual property."

Mr. Martinez further noted that the matters under consideration in the motion for preliminary injunction covered only three of the six patents and 30+ related claims currently under litigation. "Since filing the motion for preliminary injunction we have launched another suit in connection with more patents and claims that we believe are as strong as the ones favorably commented on in the Judge's report. We are considering additional claims for other Neology technology patents in the U.S. that we believe have been infringed. We also plan to seek similar remedies in international court venues like Mexico, Europe and Taiwan, where we have similar patents granted. We believe customers for the technologies in question should be fully aware of this dispute."

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