SUIT OVER CART DEVICE RESULTS IN $212M AWARD

Liza Casabona

SUMMIT COUNTY, Ohio -- A six-year court battle over a shopping cart device has resulted in a jury here awarding Smart Media of Delaware $212 million in damages.

The suit was originally filed in 1998 against Telxon, which was acquired in 2000 by Symbol Technologies, Holtsville, N.Y. As of last Wednesday, a final judgment had not been entered on the verdict, announced Sept. 17.

In its suit, Smart Media, based in Washington, claimed breach of contract, negligent and intentional misrepresentation, and promissory estoppel.

Smart Media said Telxon had broken agreements to fund, develop and co-market a shopping cart system, the SnapShopper, which consists of a touchscreen monitor and a bar-code scanner.

The SnapShopper device allows shoppers to receive savings while shopping, to self-scan their groceries, and to pay at the cart in an expedited checkout. Smart Media plans to pilot SnapShopper in stores this fall, with a national rollout planned for 2004.

In a conference call Sept. 18, Telxon and Symbol stressed the jury verdict was against Telxon, a wholly owned subsidiary of Symbol that is considered a legally separate entity.

Walter Siegel, vice president, Telxon, said that any judgment in the case would be applied only to Telxon. Telxon plans to "vigorously seek to overturn this jury award, " said a statement.

Symbol, in a partnership with software developer Cuesol, Quincy, Mass., is testing a device comparable to SnapShopper called Shopping Buddy at a Stop & Shop store in Braintree, Mass. A 100-store rollout of Shopping Buddy is planned for Stop & Shop.

That effort is prompting Smart Media to consider further legal action, said Arthur Fillmore, Smart Media's general counsel. "Smart Media believes that there are significant issues which remain concerning infringement or unlicensed use of its proprietary intellectual property, including patents, which remain to be resolved." Stop & Shop could not be reached for comment.

Meanwhile, in another legal action, Cuesol is suing three former employees and their company, Multichannel Retail Limited, for violating copyright and non-compete agreements with respect to Cuesol's Shopping Buddy software.