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On October 13, 2004, the U.S. District Court of the Eastern District of Texas lifted the stay on an injunction against Simulink® in connection with patent litigation that National Instruments brought against The MathWorks. The MathWorks took steps earlier in September to modify Simulink so that it would comply with the Court’s injunction when the stay was lifted and so that Simulink would continue to be available without any interruption.

The District Court entered the injunction in June 2003, after a jury trial, but then immediately stayed it while The MathWorks pursued an appeal because, as the Court then noted, The MathWorks had “made out a substantial case on the merits.” The stay is being lifted now because the U.S. Court of Appeals for the Federal Circuit, in Washington, DC, issued a decision on September 3, 2004, letting the jury’s mixed verdict stand.

On September 22, 2004, in anticipation of this injunction going into effect and in order to abide by the Court’s decision, The MathWorks stopped selling the enjoined version of Simulink and is now selling a modified version in a service pack (R14SP1) that contains changes related to the patent litigation. The modified version of Simulink (R14SP1) eliminated certain features so as not to infringe National Instruments’ patents, and it is The MathWorks’ position that the modified version fully complies with the Court’s decision and injunction.

The Court decision also affirmed that customers can continue to use previously purchased Simulink products that do not contain the patent-related modifications and that The MathWorks can continue to provide technical support for these products.

The MathWorks remains fully committed to the Simulink product family and, consistent with the Court’s decision, will continue to sell, support, and enhance it. The MathWorks will defend itself against any further legal proceedings that National Instruments may choose to bring.