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Zi Corp Patent Fraud ?
Internal Administrator
Posted: Friday, August 12, 2011
Joined: 10/12/2010
Posts: 5780

Posted: 9/6/2003 8:36:36 AM

By: Here to Help

You all know the Lancer connections to Zi Corp. You may not know this

Originally Zi Corp was known as MultiCorp.

Multicorp’s big break came in 1996 when they acquired the rights to a patent which they rephrased as the Jiejing Licenses. They acquired this from its supposed inventor Eric Chappell.

From 1998 Annual report,

"In February, 1998, the Company acquired the rights to and ownership of the character-based language technology underlying three separate license agreements (known as the “Jiejing Licenses”) of which the Company has been the exclusive worldwide licensee since November, 1993."

"Consideration given by the Company for acquiring the rights to and ownership of the technology underlying the Jiejing Licenses was the accelerated release of 4,525,000 common shares of the Company previously issued and held in escrow."

Chappell quickly sold the shares for a huge profit.

Contracts from Ericsson and Alcatel followed for Zi’s new input recognition technology for cell phones based on these patents.

However, the actual patent was lost in 1996 in a UK court decision after a court determined that its right were owned by its original inventors Ron Thomas and Helmut Stohr. This was the final chapter of an earlier Australian decision which favored Chappell. In other words Chappell must have lied to Zi about his loss of ownership in the patent, or Zi didn't care

To be more exact,

On the 22nd of October 1996 Chappell lost a UK supreme court case involving the rights to his only patent. . GB Patent no. 2238414 B was granted to Ron Thomas and Helmut Stohr who were granted the patents after the courts ruled that they were the valid inventors and Chappell / Yates is ruled as losing the patent. Both the Patent and the decision can be obtained from the British Patent office quite easily.

Zi basically bought a worthless patent which it never disclosed to shareholders. A key material event whether the patents were important or not. That is because of the large share payment to Chappell.

Eventually Thomas and Stohr apparently sold the patents to Tegic Communications which was eventually bought by AOL. AOL sued Zi corp in a long drawn out lawsuit and won a $US 9 MM + judgment in 2002. Furthermore Ericsson and Alcatel were sued by various parties in China for patent infringement and Zi had to agree to pay litigation costs …etc. I am not sure if this is settled yet as AOL may have dropped the charges in China.

Zi is desperately trying to pay the lawsuit settlement to this day. Of course the exact terms of the settlement will never be known to the public due to a non disclosure clause (lots of non-disclosure at Zi)

Of course in the interim somewhere in 1998 Zi obtained another patent and tried to apparently use it as a cover for the fake one. By using broad terms such as the Jeijing liscenses the lost patent can avoid being singled out. Bottom line though was that AOL had the patent in the end and won a lawsuit. That should be proof enough of non-disclosure of a material loss.

Please remember that a lot of this is opinions of facts and should be treated as such.


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