Volkswagen accused of infringing hybrid patents

Susan Decker

A Baltimore company that’s struck licensing deals after litigation with Toyota Motor Co. and Hyundai Motor Co. is now turning its sights on Volkswagen AG.

Paice LLC filed a patent-infringement complaint against Volkswagen, Porsche and Audi at the U.S. International Trade Commission Friday, claiming they’re using technology for hybrid engines without paying for it. It’s seeking an order that would block imports of those brands’ hybrid vehicles from the U.S. market.

Volkswagen is better known for its diesel engines than hybrid motors. Still, Paice and its partner, the non-profit Abell Foundation, said it spent time “teaching its patented hybrid technology to VW” more than a decade ago.

A few hybrid vehicles made by Volkswagen and its affiliates were sold in the U.S. beginning in 2010, and the company is focusing on future hybrid development because of a controversy in which it was accused of manipulating the carbon readings from its diesel cars, according to Paice.

The complaint at the trade agency is a cudgel to try to get Volkswagen to pay royalties to Paice. It’s a strategy that’s worked before. Toyota settled in 2010, just as the ITC case was about to begin trial. Hyundai agreed to pay royalties in December after losing a $28.9 million verdict.

Ford Motor Co. is holding out. The company, which had previously licensed one of Paice’s patents, is fighting a civil suit that’s on hold while the U.S. Patent and Trademark Office considers Ford’s petitions to cancel some of the patents.

Paice was founded by Alex Severinsky, an engineer who emigrated from the former Soviet Union. The Abell Foundation, named after the former publisher of the Baltimore Sun newspaper, invests in Baltimore-area companies.