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Fourteen of Microsoft Re-examination Challenges of Avistar's U.S. Patents Rejected by U.S. Patent Office

    SAN MATEO, Calif., June 2 /PRNewswire-FirstCall/ -- Avistar
Communications Corporation (Nasdaq: AVSR) has received notification from
the U.S. Patent & Trademark Office (the "USPTO" or the "Patent Office")
that as of the close-of-business on Friday, May 30, 14 of Microsoft
Corporation's (Nasdaq: MSFT) requests for the Patent Office's
re-examination of Avistar's 29 U.S. patents have been rejected.

    Avistar is represented by Paul Carmichael as its primary licensing
advisor. Among many executive assignments, Paul has served as Apple
Computer Inc.'s Associate General Counsel for Patent and Trademark and
Acting General Counsel, and in prior work, as IBM's Senior Corporate
Counsel for Intellectual Property Law during a thirty year career at IBM.

    "Data for the entire history of USPTO's re-examination activity
indicate that only 8% of re-examination requests are rejected," stated Paul
Carmichael. "While we believed that Microsoft's challenge to Avistar's
entire U.S. patent portfolio was without merit, we also recognized that the
statistics relating to us avoiding a wholesale re-examination were against
us. We are delighted that the Patent Office's review has resulted in this
extraordinary result which validates and strengthens many of Avistar's most
important patents, We expect that the 9 patents that the USPTO has agreed
to re-examine at this point also will be validated, and actually
strengthened, through this process."

    As discussed in Avistar's February 25, 2008 press release announcing
the re-examination requests filed by Microsoft, the challenged Avistar
patents have an important early priority date (1993), have already been
examined over a large body of prior art, and include patents that have
successfully withstood two litigations. Based on the history of these
patents and the USPTO's response this week, Avistar is confident it will
overcome any of the remaining re-examination requests that may be granted.
Avistar patents have industry wide applicability to audio, video and data
unified collaboration products and services.

    Simon Moss, CEO of Avistar, stated "we are obviously pleased with the
USPTO's notification that challenges to the core 14 of our U.S. patents
have been rejected. We continue to remain focused on our business
operations and have no further comment at this time with regards to our
patent discussions."

    Forward Looking Statements

    Statements made in this news release that are not purely historical,
including but not limited to statements regarding Avistar's ability to
overcome the remaining re-examination requests, the applicability of
Avistar's patents to Microsoft's present and future products, the impact
and end result of the re-examination process on the patents that are
re-examined by the USPTO, are forward-looking statements within the meaning
of Section 21E of the Securities Exchange Act. Such statements are subject
to risks and uncertainties that could cause actual results to differ
materially, including such factors, among others, as uncertainty associated
with the USPTO's review and determination process, the time and expense to
Avistar of responding to the re-examination requests and defending its
patent portfolio, difficulties associated with enforcing or licensing
Avistar's patent portfolio during the review and possible re-examination
process, and the risk that Avistar's existing and pending patents could be
revoked by the USPTO. As a result of these and other factors, Avistar
expects to experience significant fluctuations in its licensing activities
and operating results, and there can be no assurance that Avistar's future
results will meet expectations. These and other risk factors are discussed
in Avistar's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q
filed with the Securities and Exchange Commission from time to time.
Avistar disclaims any intent or obligation to update these forward-looking
statements.

    About Avistar Communications Corporation

    Avistar creates technology that provides the missing critical element
in unified communications: bringing people in organizations face-to-face,
through enhanced communications, for true collaboration anytime, anyplace.
Its latest product, Avistar C3, draws on over a decade of market experience
to deliver a single-click desktop videoconferencing and collaboration
experience that moves business communications into a new era. Available as
a stand-alone solution, or integrated with existing unified communications
software from other vendors, Avistar C3 users gain instant messaging-style
ability to initiate video communications across and outside the enterprise.
Patented bandwidth management enables thousands of users to access desktop
videoconferencing, Voice over IP (VoIP) and streaming media, without
requiring substantial new network investment or impairing network
performance.

    Avistar's desktop videoconferencing and collaboration installations are
among the world's largest, including more than 18,000 seats sold in more
than 40 countries. Clients report as much as a 20 percent reduction in
travel expense and carbon emissions, increases in productivity, and
immeasurably improved relationship building within their organizations, as
well as with suppliers and customers. Avistar holds a portfolio of 80
patents for inventions in video and network technology and licenses IP to
videoconferencing, rich-media services, public networking and related
industries. Current licensees include Sony Corporation, Sony Computer
Entertainment Inc. (SCEI), Polycom, Inc., Tandberg ASA, Radvision Ltd. and
Emblaze-VCON.

    For more information, visit http://www.avistar.com



SOURCE Avistar Communications Corporation




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  • http://www.avistar.com
    CONTACT:
    Ken Lempit of Austin Lawrence Group,
    +1-203-391-3006, k.lempit@austinlawrence.com, for Avistar
    Communications Corporation