• Bloomberg


Toyota has settled a patent-infringement dispute that had threatened U.S. imports of its newest hybrid vehicles, including the Prius.

The agreement with Paice, ending six years of litigation, was announced Monday as a hearing was to begin on a claim against Toyota before the International Trade Commission in Washington. Terms weren’t disclosed and suits pending in Texas and at a U.S. appeals court will be dismissed.

Paice founder Alex Severinsky, a Soviet emigrant who began his career developing antitank-warfare instrumentation, had said his 1994 patented system for a high-voltage method to power gas-electric hybrid cars was used by Toyota without permission. Severinsky, 65, has sought royalties from the automaker.

“Finally people understand the merits of what I invented and give it the proper value,” Severinsky said. “Toyota is the leading technology company and finally appreciates the value of the invention.”

Ford, maker of the Fusion hybrid, agreed to license Paice’s technology, the firms said Friday.

The Paice patent covers a way to supply torque to a car’s wheels from both an electric motor and internal combustion engine using a combination of high voltage and low current.

Toyota, which was found to have infringed on the patent in an earlier case, had said its hybrid vehicles are the result of its own research and asked the trade commission to deny Severinsky’s latest claims.

“The parties agree that, although certain Toyota vehicles have been found to be equivalent to a Paice patent, Toyota invented, designed and developed the Prius and Toyota’s hybrid technology independent of any inventions of Dr. Severinsky and Paice as part of Toyota’s long history of innovation,” both companies said in separate statements.

The ITC is an independent agency set up to protect U.S. markets from unfair trade practices. When a violation is found, it has the power to block imports of products and typically sides with patent owners unless there are health or public policy issues.

The issue in the trial that was to begin Monday hinged on what is more important: Severinsky’s right to protect the millions of dollars invested in his invention or the potential economic harm of banning Toyota’s hybrid imports.

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