SRAM & Fox End 6 Year Chainring & Axle Legal Battle

Jan 4, 2022 at 8:21
by James Smurthwaite  

SRAM and Fox have both filed documents that dismiss all claims and counterclaims in a legal battle that stretches back to 2015, Bicycle Retailer and Industry News reports.

The original dispute arose over chainrings, produced by Fox-owned Race Face, that SRAM alleged infringed on two of its patents. SRAM had previously licensed the X-SYNC technology to Chromag and the Accell Group, but Fox later challenged the validity of that patent. That case was followed by Fox suing SRAM for infringing on several Fox-owned suspension and axle-related patents in 2016. The battles have been the subject of plenty of column inches as the component heavyweights butted heads in courts throughout the USA.

In the end, both sides filed documents with courts in Colorado and Illinois last Thursday saying they were dismissing claims and counterclaims, with no admission of liability by either and with each side to bear their own costs and attorneys fees. Industry titles are speculating that the costs, which are believed to have spiralled into the millions, simply became too high for either party to continue pursuing the matters.

SRAM is granting Fox a non-exclusive license to make and sell products using SRAM's chainring-related patents in exchange for royalty rates. Fox is granting SRAM a non-exclusive royalty-free license to make and use products and services covered by Fox's axle patents.

SRAM and Fox have both been contacted for further comment.


170 Comments

  • 391 2
 In other news, Fox and SRAM product pricing rose another 20% today.
  • 61 3
 You mean, they got ramped by 20%. Smile
  • 135 1
 Money talks, bullshits walk I guess. Now if they could have just put those millions into a collab to end steerer creak. Would have been a real Creaking News ahh ??
  • 8 18
flag CSharp (Jan 4, 2022 at 12:31) (Below Threshold)
 They're chain-linked together in the battle of the Chain-Rings!
  • 20 8
 It sounds like both companies are in xSync now after narrowly avoiding getting wrapped around the axle.
  • 62 0
 In the end, the consumer foots the legal bill with increased prices.
  • 11 0
 @tonkatruck: instead, they added bushing play into the mix recently. Hooray for us.
  • 4 1
 came for this comment - wasn't disappointed
  • 5 1
 It’s pandemic that caused price increases…
Behind closed doors we need to increase EPS - consumers can suck a carrot .
  • 7 0
 @CSharp: The Lord of the Chainrings,
"One chainring to rule them all!!"
  • 2 0
 Whatever happened with that weirdo Knolly-Intense lawsuit? Did that have legs?
  • 4 0
 But their lawyers can afford some sweet sweet new bikes.
  • 1 0
 @rivercitycycles: not if the consumer buys their n/w chainrings from chinese suppliers.
  • 4 0
 and their lawyers bought Yetis fitted with Flight attendant and Shimano
  • 1 0
 Exactly!
  • 1 0
 @rivercitycycles: Yup! They'll find ways to bs us thru outrageous price hikes just like the bike companies.
  • 143 0
 So only the lawyers win in the end. Sheesh.
  • 91 1
 thats how the legal system works
  • 14 1
 You beat me to the quote. Lawyers sucked every dollar they could from both companies then decided it was too much
  • 5 4
 @healthcare1: the only silver lining being, it wasn’t public money. That’s kind of a win. At least we can choose if we want to buy Sram and Fox.
  • 10 1
 @healthcare1: Not really. The lawyers did their job and represented their clients for as long as their clients wanted to pursue the legal battle. Of course the lawyers want to get paid for the work they did.
  • 2 1
 Not quite. They both end up with royalty payments from the other. My guess is Sram will get a lot more for it's chain and chainring tech, than Fox will get for it's axle patents.
  • 1 2
 @Rubberelli: does Fox own the 15x110 size then?
  • 3 0
 @ctxcrossx: Not all lawyers are bad, but I saw first hand how a legal team screwed a family over to keep money in THEIR HANDS while saying they were looking out for the family. Many lawyers create work with zero value added because the clients won't notice. (and I know this isn't exclusive to lawyers).
  • 3 1
 Possibly unpopular opinion and I'm not really defending the attorneys, but I'm pretty certain the lawyers didn't walk into the c-suite with guns and force leadership into these lawsuits. Company execs have the final say in whether to open and keep pursuing these things. Cursing the lawyers is a bit like blaming the tabloids and paparazzi - if nobody bought the tabloids there wouldn't be a market or money driving the whole thing. But yes, obviously, no matter the outcome the lawyers get paid.
  • 2 0
 @Rubberelli: It seems to say only fox will be paying royalties.
  • 1 1
 ...
  • 2 0
 @Rubberelli: It actually says Sram can use Fox's axle patents royalty free, so presumably Sram either had the better case or Fox had more to lose if it went to trial.
  • 1 0
 @dthomp325: I see. It appears they agreed on their respective damages with Sram's being far higher, so Sram will most likely be charging a discount royalty rate to Fox to offset past and any future use of Fox axle patents.
  • 2 0
 @jaame: It could be something as simple as the spring action in a quick release. A size can't be patented, I don't think.
  • 1 0
 @healthcare1: like a parasite making the decision that one more suck will risk killing the host so better let go for awhile.
  • 1 0
 @Rubberelli: just trying to think what else it could be. I seem to recall Shimano and Fox jointly developed the 15mm axle. I don’t know what else RockShox have that Fox forks have. A spring action maybe.
  • 1 0
 @SprSonik: ...but nobody does it as well or as often as Lawyers do. Imagine another industry where you bill just to talk on the phone? Or are paid based on an outcome that you cannot guarantee and then you get paid whether you win or lose (Do what you were paid to do or not?).

Shakespeare was right.
  • 1 0
 @Thinkker59: I don't think lawyers are paid to win, I think they are paid to represent.If only clear-cut, winnable cases would guarantee payment the entire right to a defense thing would be fairly subverted.
  • 135 1
 I guess neither party had the teeth for this fight.
  • 26 0
 They just couldn’t see the lawsuit thru.
  • 52 0
 No more axles to grind....
  • 30 0
 That's a pretty narrow view of the issue.
  • 8 8
 @kcy4130: Way to bRing in the new year!
  • 21 1
 Stick a fork in it; it's done.
  • 16 0
 They both took a narrow view of a wide ranging problem. But now they should be able to axle at what they do best.
  • 5 14
flag Falcon991 (Jan 4, 2022 at 13:19) (Below Threshold)
 @kcy4130: A narrow-WIDE view of the issue?
  • 29 0
 some things never chains
  • 4 0
 They decided to put a pin in it
  • 2 0
 Next time they won’t take such a wide view of their patents.
  • 7 0
 The argument was just going in ovals, so they took the time to sync about it and decided they'd just offset the legal costs by raising prices on all of their products.
  • 1 0
 They were just going round and round until they decided to work together
  • 8 0
 Litigation is never a cinch
  • 1 1
 @Chadimac22: Gold and whoosh at the same time.
  • 87 4
 Imagine these millions going to pay athletes…
  • 89 1
 Or just not resulting in price increases that get passed along to the average rider.
  • 57 2
 Or R&D, or trail building. Such a waste.
  • 43 1
 @privateer-wheels: or below average, in my case.
  • 7 0
 Imagine using other suspension and other components
  • 12 2
 @kcy4130:
R&D money is what both of these companies already spent on developing the products in question in hopes that their patents would allow them to make good return on that R&D investment. Innovation and R&D spending are discouraged if there isn't some sort of patent system and legal defense of those patents. But I agree that weaknesses in our patent system and self-interested excesses in our legal system can squeeze far, far too much money out on this end of things
  • 5 3
 These companies would be tiny and not in a financial position to sponsor athletes if their designs and products weren't protected by patents. That's how they are able to make money and not have everything copied and be put out of business. It's like this in any industry. Patents also result in R&D and new/better products. Companies would not hire engineers, do tons of R&D/design work and develop a product for the masses if they can't patent it.
  • 2 0
 This, for me, has to be the most unexpected comment to see on this topic.
“Imagine these millions going to athletes”

Wild
  • 1 1
 @showmethemountains: This is a really good point that I think a lot of people will miss! They are protecting their investments/innovations that they have already spent millions on. At a certain point the numbers don't add up, but until then it's certainly worth fighting for.
  • 1 0
 It did pay athletes: the lawyers athletic children and the athletes of the lawyers alma mater Smile
  • 2 0
 @showmethemountains: ??? Care to expand on that? I've worked in manufacturing and design in the outdoor industry and no one batted an eye at the money we dumped into R&D projects. Not a word about patents or lawyers.
  • 3 0
 @DahvBooey: the point is that companies wouldn’t spend money on R&D if there wasn’t a system in place (ie patents, and litigation to enforce them) to protect that investment. Otherwise that R&D money is wasted if anyone can just steal your ideas and sell the same product at lower prices because they don’t have to recoup the R&D costs
  • 1 1
 @DahvBooey: When you consider a ride, do you comment that there will be air to fill your tires? Of course not because it’s just a basic fact of the eco-system. It would just be weird for someone in R&D to bring up a widely known and assumed reality when planning.

That doesn’t mean patents are actually essential to the R&D process like air is for your tires, just that there’s no reason for it to be discussed in the first place.
  • 1 2
 @waxloaf: That’s a nice theory and all, but I haven’t seen it supported by real world evidence. It could just as easily be that companies innovate first and foremost to make their immediate product lines better, then patent what they can. And nothing actually says those patents are even about preventing others from ripping them off - they could just as easily be about preventing someone else from patenting over the top of their idea and then suing them.

Maybe there’s some study sorting it all out one way or another, but the subject is far to complex for intuitive assumptions to be definitive one way or another.
  • 1 0
 @Blackhat:
I don’t know which company you worked for, but at the size of Fox (public company) and SRAM, it is essential to protect their intellectual property to recoup their R&D spend. Or else, like others have pointed out, the competitor would just copy it and then there will be no innovation.

Read Fox’s annual report:
“ The Company devotes significant resources to protecting its intellectual property, relying upon a combination of copyright, trademark, unfair competition, patent, trade secret and other laws and contract provisions. There can be no assurance of the degree to which these measures will be successful in any given case. Policing unauthorized use of the Company’s products and services and related intellectual property is often difficult and the steps taken may not in every case prevent the infringement by unauthorized third parties of the Company’s intellectual property. The Company seeks to limit that threat through a combination of approaches, including offering legitimate market alternatives, deploying digital rights management technologies, pursuing legal sanctions for infringement, promoting appropriate legislative initiatives and international treaties and enhancing public awareness of the meaning and value of intellectual property and intellectual property laws. Piracy, including in the digital environment, continues to present a threat to revenues from products and services based on intellectual property.”

So there you have it. Also I worked in corporate strategy for a publicly traded component manufacturer for 9 years. And yes it is a real common concern that comes up and most have legal teams and processes to file patents to protect their intellectual property. You either just don’t see it, like others mentioned, or the company is too small to truly be innovating much.
  • 2 0
 @Razarath: IP is so much more than patents. The fact that intellectual property generally is an important part of running a business does NOT prove that patents are an effective, necessary, efficient or desirable method to achieve that goal. Patents were a very small part of the list you provided and we have no real way to know how much Fox relies on them compared to the other techniques.

Since my professional experience is apparently important, I’m an engineer for Denso, the second largest automotive supplier in the world. I think our revenue last year was around $60B. And yes, we are absolutely obsessed with protecting IP. I’m sure patents are one of the tools we use, but it’s WAY down the list behind maintaining confidentiality, restricting pictures in our facility, monitoring product drawing databases to prevent mass downloading etc.

So I maintain my statement that I would like to see evidence - real evidence not fluffy words in corporateese- that patents are a major factor in a companies decision to innovate. Because looking at the real world and stories like the one above, they seem quite impotent to actually protect IP despite adding significant costs to the process.
  • 2 0
 @ceecee: can’t tell if you’re posting that in support or opposition of my point, but if it’s the latter you’re going to have to flesh your point out a bit.

All I see is an insane waste of economic resources in litigation.
  • 1 1
 @Blackhat: and you can't see how this might be a deterrent, even if it's not the only one, and undesirable? I guess at $60B you're so BIG that you're major. 'Patents are one of the tools we use'--there's no real opposition here, unless it's Blackhat: correct//others: incorrect
  • 2 0
 @ceecee: I’m just trying to understand your point is all. Sorry if that word bothered you.

I can certainly see how it *might* be a deterrent and proactively acknowledged as much in a previous post.

Can you see how it *might* be a massive waste of resources in a negative sum game that only lawyers win?

You don’t have to get sarcastic about my ‘credentials’ - I know how stupid they are but I’m not the one who brought them up.
  • 1 0
 @Blackhat: *Might* makes right. Lawyers don't take all of it
  • 1 0
 @Blackhat:
I give up. Ask your legal team if you think it’s important or not. Based on your expectation of evidence, it is impossible to “prove” that it is important and it deters others from ripping off the technology companies put time and money to develop. I have no clue what you are looking for.

The company you work for is important because depending on the size, economic value generated from the IP will be different, and this may not be worth the time and effort spent on protecting it.

But in any case, a simple fact is look at medicine and generics. If pharmas didn’t have a way to protect their IP, they wouldn’t bother making it will they? Why do you think the generic mfgs wait till the patent is over and just copy the formula? Obviously because it’s cheaper and there is no development cost incurred.

But in any case I give up.
  • 1 0
 @Razarath: I'm looking for you to question your assumptions a tiny bit. That's all. Or at least acknowledge that they are assumptions based on unproven theory. If you want to continue holding those assumptions after making that acknowledgment that's fine.

Pharmaceuticals is certainly the obvious case where they are important. But as an industry it's an outlier among outliers - astronomical R&D costs coupled with easy to copy products. To extrapolate from that to infer that without patents we wouldn't have wide narrow chainrings or updated seals on suspension is a bit far.

Consider this: if patents were not a major factor in most technological innovations, how would you know given the current system? Because the current system is so omnipresent that a company simply MUST care about them, even if they don't actually care about excluding others from their innovations. And if there's not a way to falsify the importance of patents, maybe we should be a little more cautious in defending them given the easily provable costs that come with them.
  • 56 0
 Lawyers ALWAYS win in the end regardless of the results
  • 62 2
 Yeti sales will now be up 20%.
  • 17 33
flag BoneDog (Jan 4, 2022 at 12:12) (Below Threshold)
 @kinematix: only posers buy yetis mang.
  • 13 9
 @kinematix: You beat me to it....what will all the dentists do when they show up and all the yeti's have been sold the the sram/fox lawyers....
  • 10 18
flag SterlingArcher (Jan 4, 2022 at 13:23) (Below Threshold)
 @pink505: lol you’re poor
  • 3 4
 @kinematix: Inching closer to Specialized!
  • 33 0
 I make a motion that we shift our collective ire from dentists to lawyers, just for 2022, just to see how it feels
  • 10 0
 @VtVolk: agreed. Dentists is for the most part a great profession. Lawyers on the other hand....... Big Grin
  • 5 1
 @bman33: hands up if your a lawyer on pinkbike
  • 14 21
flag SterlingArcher (Jan 4, 2022 at 15:15) (Below Threshold)
 @Compositepro: instead of complaining about the rich, your time would be better spent trying to get rich.
  • 23 2
 @SterlingArcher: I can imagine hundreds of things more worthy of my time than “trying to get rich”.
Writing this comment is one of those things.
  • 9 1
 @VtVolk: Can we demonize the real estate industry and the agents who spew crap from the same old fomo play book as well? The same houses that were unaffordable last year became even more unaffordabler.
  • 3 0
 Fiddy cent says get rich or die trying , oh I’m screwed then
  • 2 0
 @woofer2609: this is the internet man demonise everything , in the real world , wont make a difference
  • 3 0
 @VtVolk: You're onto something. We managed to get Saturday Sends and Sunday Saves, so we need the PB Event Calendar. Every January 1 there's a recurring event: "Ire for Change: Denigrate (INSERT NEW GROUP HERE)". Then we'll all be on the same page and we may see more parity in some of the market forces.
  • 1 0
 @iammarkstewart: this is the only place anyone ever talks about dentists....they might be upset if we stereotype others.
  • 1 0
 @pink505: you should see the paceline forum , i dont think you can even sign up unless you show your authentic dentist card
  • 43 0
 New suspension brand in 2023: Srox
  • 34 0
 only because Fram was taken.
  • 1 1
 @ReformedRoadie: can I steal that name for my company when I realise life has so much more to offer than monetary value
  • 1 1
 @ReformedRoadie: Just sue them to give their name up.
  • 37 1
 What a stupid waste of legal fees
  • 33 0
 Big companies do boring shit, who knew?
  • 25 0
 I read this as Fox losing. They pay royalties, SRAM doesn't. Also who gives a fck
  • 10 1
 Wish all this money could have been invested in trails
  • 3 15
flag SterlingArcher (Jan 4, 2022 at 13:24) (Below Threshold)
 @wburnes: but there’s plenty of people who are willing to work on trails for free
  • 14 4
 @SterlingArcher: false. There are a handful of people who work on trails for free-and a lot of a$$hats that complain that trails are too hard or too easy.

If you've got WalMart money, you can pay for McTrails built on a per linear foot cost basis.
  • 13 1
 @wyorider: Of all the things to rip on the Walton's about you choose the trails they fund. On this one thing, just be cool and give them a pass.
  • 4 8
flag SterlingArcher (Jan 4, 2022 at 15:11) (Below Threshold)
 @wyorider: it’s a question of supply and demand. If there’s enough people who will work on trails out of the love of sport and passion and all that bs then why would others need to foot the bill?
  • 3 5
 @wyorider: you are in no position to tell anyone how to use their money.
  • 18 1
 So can fox print sag gradients on their shocks and forks now? I know it’s not part of this but it seems asinine that rockshox can monopolize that “technology”. I would never choose on fork over another because of the marks but I appreciate them when they’re there.
  • 1 0
 I don’t think it’s the marks themselves per se, but rather the process of laser etching them on or whatever manufacturing technique they use.
  • 21 0
 Riveting.
  • 2 0
 The original Ring scares the shit out of these two companies.
  • 15 0
 When I worked in the tech industry we kept a file on all our patents that our competitor infringed on and which patents of theirs that we infringed upon. As long neither of us infringed on any of the blockbuster key tech that we each owned we just kept the peace. If either side had decided to sue the other it would have been extremely painful for both. It was essentially like nuclear weapons and Mutual Assured Destruction. As long as there was some parity there was no legal action.
  • 3 0
 Yep, in the MTB industry, if someone starts suing someone else, it's because someone's girlfriend or boyfriend was stolen.
  • 3 0
 I can confirm these folders exist in other industries too. We definitely have them in aerospace and industrial robotics. When I worked at an investment bank, we asked to view “close competitor equivalent patents” in order to assess potential risks.
  • 12 0
 Thank god that's over. Now can I please get a 12spd chain available in the next 3 years?
  • 11 0
 Too bad they didn't come to this conclusion 7 years ago. I mean, millions spend. How much is that per chainring?
  • 11 0
 And all legal fees were passed on to the consumers.
  • 7 0
 A guy walks into a bar and says,”lawyers are a*sholes!” A fellow at the bar says, “Hey, I take offense to that!” The other replies, “What? Are you a lawyer?” The guy at the bar responds, “No! I’m an a*shole!”
  • 11 1
 Foxshox®️
  • 6 3
 FoxFace or HeadShox??
  • 13 0
 @likeittacky: you're about to get sued by Cannondale
  • 3 0
 @takeiteasyridehard: That's how Lefties roll. Pun intended!
  • 1 0
 @likeittacky: Headshox, there's another court case.
  • 2 1
 @takeiteasyridehard: lol I was just going to say. Cannondale is going to beat yo ass
  • 3 0
 Sraceface
  • 1 1
 @takeiteasyridehard:
Hah! We all know that Specialized will sue you for misusing someone else’s name faster than Cannondale will for misusing the Cannondale name.
  • 5 0
 I'm so glad I don't battle over this type of engineering dorkiness. Killing dragons and slayin' it with the maidens is so much more rewarding.
  • 5 2
 SRAM: we don't need this, we have an AXS ebike motor gearbox to build! FOX: we dont need this, we need to sort live valve out! Legal system: GTFO you two, we have COVID money to make for the next 20 years...S works kenevo's for everyone?
  • 6 0
 awww thats nice of them both
  • 6 0
 Ok. Thanks for letting us know.
  • 2 0
 Wonder if this means we'll be seeing Fox's floating axle thing from their forks on rockshox forks in the future. I have no idea what tech is technically covered on the patents they're talking about.
  • 4 0
 Its like an epic two gang reach around only both parties are not going to get their happy ending
  • 1 0
 X-sync is the best 1x chainring and they beat everyone else to the market. RaceFace should have invested in developing their own alternative instead of copying Sram or used Shimano's (not as good) design since they have a partnership.
  • 1 0
 "SRAM and Fox have both been contacted for further comment." has anyone ever seen the follow article/post to this line on other articles? They never seem to post the responses from these "contacts with involved parties" or at least very seldom?
  • 4 1
 lol these guys arguing over narrow wide chainring patents when Wolftooth and others have been doing it for 10+ years
  • 4 0
 Because WT has their own.
  • 3 0
 na dude X-sync clearly is better then just NW
  • 5 0
 Wolftooth was part of the original suit in 2015, they just decided to work with SRAM instead of running up billable attorney hours.
  • 4 0
 Specialized not involved in a lawsuit? Boring.
  • 4 0
 Anyone can see that one is narrow-wide and another is wide-narrow!
  • 2 2
 In the paintball industry Smart Parts sued everyone who use a micro switch as a trigger mechanism. To tell the board to operate the solenoid to make the marker operate. it was a sad deal causing 3 big companies to close its doors along with them selfs. The rest is history
  • 2 0
 Man talk about a blast from the past. I was heavily involved with the PA paintball scene back in the day (Smart Parts was based in Pennsylvania) and I remember this going down. They weren't so Smart after all it seems.
  • 2 0
 .......and this is why suspension and parts cost so much. Had they not spent the millions on lawyer fees then the customer would be paying significantly less for everything
  • 2 0
 Not the most efficient way to get there, but if this means more parts standardization, I'm happy about that.
  • 3 0
 If they can figure it out, maybe there’s hope for the Middle East yet
  • 1 0
 Sram and fox have no idea that lawyers are good at dragging this to the end of the company to see who gives up first. Dont underestimate the power of paper work!
  • 2 0
 sram Kabolt and raceface chainrings that work, coming soon!!!! lol
  • 2 0
 Welp. Thank God that’s over.
  • 2 0
 The only people wining in that argument was legal counsel.
  • 2 1
 The mental image I had (and now wish I could forget) was the Fox lawyer and the SRAM lawyer jumping up and passionately making out in the middle of the courtroom when the judge announced the settlement.
  • 1 0
 @pixelguru: Wouldn't they be kinda sad? Now they have to find something else to spend billable hours on.
  • 1 0
 Think of the blinged out XX1 AXS rocking carbon wheeled Kashima coated Yeti or Pivot rig those lawyers could buy!
  • 1 0
 Corporate waste of money like this is the exact reason we consumers pay higher prices than necessary for products!
  • 2 0
 And the only winners are the Lawyers
  • 1 0
 Wow. I should become a lawyer. Basically nobody won and the lawyers made a lot of money
  • 4 0
 Essentially SRAM won as they are getting a royalty now for the chain rings from Raceface where as SRAM are not paying a royalty on the Fox axles.
  • 1 0
 And who pays the price to fund all this legal bullcrap? Us, the consumers. As if bike parts weren't expensive enough as is.
  • 2 0
 Maybe Sram and Fox can join forces and call it "Srox"?
  • 1 0
 Pmsl well if you fat cats would of done that in the begining hey
Oh well your greed cost you Smile
  • 1 0
 Everyone walks away with this with nothing to show ... except the lawyers. They are havving a massive cocaine party!
  • 1 0
 Now any of them should reinvent the axle and release the ultra hecta boost type 13x115mm
  • 1 0
 Understandable, have a nice day.
  • 1 0
 So should I ride my bike or make sure I have the proper components ?
  • 1 0
 They are going to merge i would say!!
  • 1 1
 Another reason I don’t use big box brands. Spend the money on design and not on bullshit like this
  • 2 2
 Who really gives a FCUK...non-dentists me thinks!!!
  • 1 0
 M.A.D. at work.
  • 1 2
 So they decided to stick a pin in it?
  • 2 4
 Just another example of the enforcement of intelectual property hurting the consumers...





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