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The long-running legal battle between Toyota and Alex Severinsky over who "invented" a critical piece of hybrid technology is heading into a new phase. The automaker and the Russian engineer will be making their respective cases before International Trade Commission judge Theodore Essex to determine if Toyota can continue to import its hybrid vehicles into the United States.

A 2005 trial already ruled that Toyota was infringing on Severinsky's patent and ordered Toyota to pay royalties. Toyota is appealing the royalty judgment but the ITC has nothing to do with that. Instead, the ITC will decide if Toyota's imports are hurting Severinsky's domestic market and the public interest. The question is, "what is in the public interest?" This can be viewed in different ways. Is it more important to keep Toyota's hybrids flowing to market, preserving jobs at dealers and factories, or to protect Severinsky's intellectual property?

While we certainly think that there has been way too much litigation by patent trolls, especially with regard to software and business process patents, Severinsky is a very different case. Severinsky is actually the inventor, rather than just some holding company that buys up patents. As such, he should probably be protected. Toyota lost its case and should probably just pony up some royalties.

*UPDATE: Looks like Toyota and Severinsky have settled.

[Source: Bloomberg]

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