By Margaret Cronin Fisk

Jan. 3 (Bloomberg) -- Juries in the U.S. awarded $1 billion in patent damages last year, almost triple the 2005 amount, as technology companies including Rambus Inc. and TiVo Inc. stepped up their use of the courts to fend off competition.

The number of patent verdicts ranking in the top 50 jury awards jumped to 10 from three in 2005, according to data compiled by Bloomberg. Total awards, counting just those of more than $1 million each, rose from $379 million the year before.

Companies are more willing to go to court to protect patents because the stakes are higher as computer and communications technology spreads, said Gregory Stone, a Los Angeles patent attorney who won a $307 million award, last year's largest, for Rambus, a designer of computer-memory chips.

``These are extraordinarily invaluable inventions,'' Stone said.

Rambus, based in Los Altos, California, won the verdict against Inchon, South Korea-based Hynix Semiconductor Inc. in April over patents covering dynamic random access memory. The trial judge reduced the award to $133.4 million.

The $1 billion in patent awards last year excludes the $612.5 million Research In Motion Ltd. agreed to pay patent licenser NTP Inc. in an out-of-court settlement of a dispute over Research in Motion's Blackberry e-mail phones.

The payment by Waterloo, Ontario-based Research in Motion to NTP of Richmond, Virginia, was the fourth-largest legal settlement of the year.

`System Works'

While patent awards rose, the value of the largest 50 jury verdicts declined to $6.3 billion from $8 billion in 2005 and $37 billion in 2004. The jump in patent payouts may spur more suits and trials this year, said Larry Laycock, a patent attorney with Workman Nydegger in Salt Lake City, Utah.

``To commit the resources, you've got to know there's a chance of the system working,'' he said. ``These verdicts show the system works.''

Laycock's client, Sunnyvale, California-based Finisar Corp., won a $79.9 million verdict covering royalties due from DirecTV Group Inc., whose satellite broadcast system used the information-transmission technology of the patents in dispute.

DirecTV, based in El Segundo, California, denied any infringement and has appealed, said company attorney Victor Savikas of in Los Angeles.

Patent infringement lawsuits have more than doubled since 1990, when 1,236 were initiated. The number peaked at 3,075 filings in 2004 before dropping back to 2,720 in 2005, according to the Administrative Office of the U.S. Courts in Washington. Filings for last year aren't yet available.

Understanding Technology

Companies have become more willing to bring complex technology cases to juries, Rambus attorney Stone said. ``Everyone is beginning to recognize that juries are able to make sound decisions on technical issues,'' said Stone, of Munger, Tolles & Olson.

Patent holders and accused infringers are now more likely to take matters to trial to avoid being shut out of a high tech marketplace, said attorney Ken Nissly of San Jose, California, whose client Hynix lost the Rambus verdict.

``Companies are becoming more aggressive in enforcing their patents and consequently more are being tried,'' Nissly said. Intellectual property ``may be worth more than the brick and mortar assets.''

Jurors also are more likely to value technology than in the past, said Ernie Brooks, a Southfield, Michigan, attorney who represented Z4 Technologies Inc. in a dispute with Microsoft Corp. and Autodesk Inc. over a method to prevent software piracy.

``As cultural perceptions have changed, this has had an impact on the verdicts and the judgments,'' said Brooks of Brooks & Kushman.

Damages Added

A Texas jury awarded his client $133 million, including $115 million from Redmond, Washington-based Microsoft. U.S. District Judge Leonard Davis added $25 million in damages against Microsoft, based on a jury finding of willful infringement. Microsoft, the world's largest software maker, has appealed.

Three of the top 10 patent verdicts, including those against Microsoft and DirecTV, came in suits filed in federal court in the Eastern District of Texas, where inventors and other patent owners have won jury verdicts 90 percent of the time since 1994.

Also in the eastern district, in Marshall, TiVo won a $74 million verdict against EchoStar Communications Corp. for infringement of TiVo technology that allows viewers to record one television program while watching another. Englewood, Colorado- based EchoStar, which denied infringement, has appealed.

``Particularly in the last five years, there has been an increase in the number of cases in the Eastern District of Texas,'' said attorney Morgan Chu, of Irell & Manella in Los Angeles, who won the verdict for Alviso, California-based TiVo.

``But the large cases are everywhere,'' Chu said. ``The importance of technology for our economy as a whole has been on a steady increase for many years. It's just part of a continuing trend.''

Top 10 Patent Awards in 2006:

Award               Winner              Loser

1. $307 million     Rambus              Hynix Semiconductor

2. $133 million     Z4 Technologies     Microsoft, Autodesk

3. $112 million     Texas Instruments   GlobespanVirata

4. $78.9 million    Finisar             DirecTV Group

5. $74 million      TiVo                EchoStar Communications

6. $65.2 million    Ariad Pharmaceuticals    Eli Lilly

7. $53.4 million    LG Philips LCD      Tatung

8. $52.5 million    LG Philips LCD      Tatung

9. $38.5 million    MuniAuction Inc.    Thomson

10. $34 million     Power Integrations  Fairchild Semiconductor