Bankrupt Kodak loses a key Apple patent ruling

July 22, 2012, 10:44 AM UTC

The QuickTake 100

FORTUNE — In the early 1990s, long after Steve Jobs left the company, Apple (AAPL) approached Kodak (EKDKQ) executives and asked them to build a camera for the Mac.

The result — the QuickTake 100, released in 1994 — was one of the first digital cameras designed for consumers. It was hailed by Time Magazine as one of the 100 greatest and most influential inventions since 1923 (the year Time was launched) and mourned by PC Magazine as one of 21 Great Technologies that Failed.

Fast forward to January 2012. Kodak, only weeks from filing for bankruptcy protection, is planning to auction off a portfolio of more than 1,000 patents valued at several billion dollars. Trouble is, some companies are refusing to pay licensing fees for the technologies in question, among them Apple. So on January 10 Kodak sued Cupertino for infringing on, among other patents, a method for previewing digital images on an LCD screen used in the QuickTake 100.

Apple, no stranger to patent litigation, countersued in May, claiming Kodak had “misappropriated” a technology the two companies developed together. Kodak fired back, calling the suit “a ploy calculated to prevent the debtors from using the [bankruptcy] sale process to obtain a fair price for Kodak’s digital capture portfolio (or to enable Apple to buy it on the cheap and extinguish its infringement exposure).”

On Friday, the U.S. International Trade Commission issued a ruling that went against both companies: It ruled that the patent in question — No. 6,292,218 — was invalid.

That’s no big deal for Apple. It has lots more patents and plenty of cash.

For Kodak, however, it’s a major blow, according to Dana Mattioli’s report in Saturday’s 
Wall Street Journal

“Since the patent at issue was one of Kodak’s most valuable,” she writes, “the ruling raises fresh questions about how much money the company, now in Chapter 11, can raise from an auction that is expected to conclude next month.”

Kodak, not surprisingly, plans to appeal.

And what happened to the QuickTake 100? It was one of the products Steve Jobs killed when he returned to the company in 1997.