Sprint Corporation and Subsidiaries, f.k.a. United Telecommunications, Inc. - Page 23

                                       - 23 -                                         
          right to transfer the software load in conjunction with a                   
          transfer of the digital switch without NTI's consent.  Respondent           
          attempts to characterize that right as a “right without                     
          substance” because any new owner of the digital switch would have           
          to acquire a new software load, unless the switch was used in the           
          same location.  That condition, however, appears relatively                 
          unrestrictive in light of Sprint's trade of approximately 30                
          similar digital switches with ConTel Co., in the late 1980s,                
          which resulted in none of the switches actually changing                    
          location.  Lastly, the Sprint/NTI agreement provided that the               
          risk of loss with respect to the digital switch, including the              
          NTI software load, would pass to petitioner upon delivery.                  
               Respondent points to certain provisions in the Sprint/NTI              
          agreement as evidence that the benefits and burdens of ownership            
          did not pass from NTI to petitioner.  In particular, respondent             
          focuses on certain provisions in the Sprint/NTI agreement that              
          provide that the software transferred with the digital switch               
          manufactured by NTI was to be treated as the exclusive property             
          and trade secret of NTI and that petitioner was under certain               
          obligations to protect NTI’s interest in the software.  The                 
          provisions of the Sprint/NTI agreement cited by respondent all              
          relate to NTI’s interest in the intellectual property underlying            
          the NTI software load.  Those provisions protect, reinforce, and            
          extend NTI’s intellectual property rights in that software.                 
          NTI’s retention of those rights is consistent with the conclusion           




Page:  Previous  13  14  15  16  17  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  Next

Last modified: May 25, 2011