Sperry Rand Corporation, Univac Division. Honeywell vs. Sperry litigation records

The Honeywell-Sperry Rand suit grew out of the ENIAC patent, which covered basic patents relating to the design of electronic digital computers. After the patent was granted to the Sperry Rand Corporation in 1964, the corporation demanded royalties from all major participants in the computer industry. Honeywell refused to cooperate, so Sperry Rand then filed a patent infringement suit against Honeywell in 1967. Honeywell responded in the same year with an antitrust suit charging that the Sperry Rand-IBM cross-licensing agreement was a conspiracy to monopolize the computer industry, and also that the ENIAC patent was fraudulently procured and invalid. Honeywell filed suit against Sperry Rand and its subsidiary, Illinois Scientific Instruments, Inc., in U.S. District Court (Minnesota District, 4th Div., No. 4-67-Civ. 138).

The ENIAC patents were filed in 1947 by John W. Mauchly and J. Presper Eckert arising from the work conducted at the Moore School of Electrical Engineering at the University of Pennsylvania. In 1946, Eckert and Mauchly left the Moore School and formed their own commercial computer enterprise, the Electronic Control Company, which was later incorporated as the Eckert-Mauchly Computer Corporation. In 1950 Remington Rand acquired Eckert-Mauchly and the rights to the ENIAC patent eventually passed to Sperry Rand as a result of a merger of the Sperry Corporation and Remington Rand in 1955.

Following extensive discovery procedures the case went to trial in June 1971. Over 32,000 exhibits, some of several hundred pages each, were introduced as evidence. The trial transcript was over 20,000 pages long. In April 1973 Judge Earl Larson found that Honeywell had infringed on the ENIAC patent, but the patent was invalid because the ENIAC had been in public use for over a year before the application was filed. The 1956 agreement between Sperry Rand and IBM was determined to be a "technological merger" and a conspiracy in restraint of trade in violation of Section 1 of the Sherman Act because the two companies together had 95 percent of the relevant market at the time. No damages or court costs were awarded to either party of the dispute.

The court also declared that the invention of the ENIAC was derived from the work of John V. Atanasoff at Iowa State University. Atanasoff and a graduate student, Clifford Berry, had developed a prototype electronic computer in 1938, later named the Atanasoff Berry Computer (ABC). John Mauchly visited Atanasoff in 1941 and was aware of the ABC, and Atanasoff believed that the design of the ENIAC was based on the ABC. This meeting became an important issue for the plaintiff during the trial.