3D Systems and Formlabs Settled Two-Year Patent Dispute

By Yixuan Long – Edited by Yaping Zhang 3D Systems, Inc., v. Formlabs, Inc., No. 13-cv-07973-RWS (S.D.N.Y. Dec. 1, 2014) (order granting dismissal with prejudice) Slip Opinion hosted by Scribd. Complaint for Injunctive Relief and Damages, 3D Systems, Inc., v. Formlabs, Inc., No. 0:12-cv-03323-MBS (D.S.C. Nov. 20, 2012) Complaint hosted by Archive.org. On December 1, 3D Systems and Formlabs agreed to settle their two-year legal dispute over patent infringement. Terms of the settlement are undisclosed. 3D Systems sued Formlabs in 2012 for infringement of No. 5,597,520 Patent (“the ‘520 Patent”), granted to 3D Systems in 1997. 3D Systems at *5. The patent covered different parts of the stereolithographic three-dimensional printing process, which uses a laser to cure liquid plastic. Id. 5–11. The patent will have expired in 2017. TechCrunch and Boston Business Journal overview the settlement. Gigaom analyzes its background and impact. In 2012, Formlabs, then a startup company with three people, launched a crowdfunding campaign on Kickstarter for its first product, Form 1 3D printer. The campaign was a huge success. It raised close to $3 million and allowed Formlabs to distribute over 1000 printers to customers. 3D Systems then filed the lawsuit over Formlabs’ use of stereolithography technology. The dispute between 3D and Formlabs is one among many ongoing patent warsin 3D printing industry. For example, 3D printing giant Stratasys sued Afinia in 2013 for infringing four patents. See Complaint for Patent Infringement, Stratasys Inc. v. Afinia, 2013 WL 6668304 (D. Minn. Nov. 25, 2013). Stratasys has since dropped one of its allegations. The court recently denied Afinia’s motion for partial summary judgment on one patent. See Stratasys Inc. v. Afinia, No. 13–3228 (DWF/TNL), 2014 WL 5438396 (D. Minn. Oct. 22, 2014). The possibility of patent infringement seems to get in the way of the expansion of 3D printing market, posing financial problems and potential legal risks for companies like Formlabs and Afinia. While the monopolistic power of a patent spawns innovation, such power also stifles market competition. Unsurprisingly, the expiration of certain key 3D printing patents coincided with 3D printing becoming an affordable craft. On January 28, 2014, one of the key 3D printing patents related to Slective Laser Sintering (SLS) technology expired. SLS is a low cost and high resolution 3D printing technology, and commentators predict that its expiration will lift intellectual property barriers to more competition in 3D printing, and hence lead to lower price for customers. Nevertheless, 3D printing companies have been continuously filing new patents applications, and the ones remain in effect have consistently been under lawsuits. Back to the 3D Systems and Formlabs settlement. Although observers read this to mean that Formlabs did not come away from the settlement with a win, Formlabs would now be able to focus on its own growth as a company. As of this year, Formlabs has expanded from a trio at the MIT Media Lab to a company with 80 employees in a new 15,000-square-foor office. As a spokesperson for Formlabs said in response to the settlement, “[i]t's really great to move beyond the lawsuit and focus on building really important products people love.” Yixuan Long is a 2L at Harvard Law School.