FOLKS HOLDING THEIR

breath ahead of

Research in Motion's

So say market watchers who have followed the ongoing soap opera between Canada's RIM and Arlington, Va.-based holding company NTP. While headlines teasing a potential shutdown of U.S. BlackBerry devices certainly attract attention, the service isn't about to be squished just yet. Nothing involving the court system happens that quickly just as no part of this crazy patent-infringement dance has moved along with any bit of speed, or, for that matter, grace.

To recap: In 2001, NTP claimed that RIM infringed on some of its patents. In the years since, countless rounds of "Yes you did!"/"No, we didn't!" have played out in the courts. There have been rulings, appeals, proposed settlements, scuttled settlements and, yes, even some name calling. The U.S. Patent and Trademark Office got involved in the matter, as did the Department of Justice. Even the Supreme Court joined the fray by refusing to hear the case.

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At the end of the day, the salient issues are these: NTP claims RIM encroached illegally on its patents, a contention that RIM denies. The U.S. Patent Office has rejected nearly all of NTP's patent claims (the latest thumbs-down came on Wednesday), but U.S. District Judge James Spencer, who's overseeing the proceedings and reportedly has tired of them, has made it clear there won't be a delay so the Patent Office can finish its review. If an injunction is issued, RIM says it has a "workaround" software solution that it can deploy. NTP, which makes no products, is eyeing a fat settlement. RIM? It's looking to put the matter to rest.

Friday's face-off will involve plenty. The court will hear final arguments from both companies, as well as the DOJ. A potential injunction against RIM likely will be discussed, as will its workaround solution that's waiting in the wings. The judge also will decide whether to take into account new information from the Patent Office that has rendered most of NTP's patent claims moot. In the unlikely event an injunction is ultimately issued, there's the question of whether any groups of subscribers government employees or perhaps even all current BlackBerry users would be excluded from the ruling. There's also the matter of damages: How they'll be tallied and what they'll amount to.

Bottom line: RIM and NTP have spun a web so complicated that it can't be untangled in the course of an afternoon. Hence, no one's expecting any kind of final decision this week. Next week could be a different story after the judge deliberates, analysts say. But don't be surprised if Friday is a nonevent.

I've said before that I expect RIM to get out its checkbook to resolve the NTP matter, and I still do. Sure, recent decisions at the Patent Office favor RIM, but NTP can always appeal, potentially dragging out the legal mess for years. If you ask me, both have a vested interest in putting this litigation to bed. As for the price tag needed to end the patent drama, that's open to debate. Pablo Perez-Fernandez, director of research at Geneva-based investment manager Sagio Investments, figures it could be between $450 million and $1 billion. Those numbers are in line with other estimates.

RIM needs to put this case behind it. Doing so would eliminate the big, black cloud that's hung over its stock and blown it every which way in the past 52 weeks. At one point last year, RIM shares were down as much as 30%. After rebounding significantly late in the fall, they finished 2005 20% lower. They're up 8% this year, but that's come with some stomach-dropping moves along the way.

Of course, massive swings can also make for profitable trading. In the past year, RIM shares have bottomed in the mid-$50 range and topped out in the mid-$80 range. Until the legal situation is resolved, not much will send the stock materially higher or lower, but there's money to be made trading it, says Fernandez. At around $72, however, he considers the stock a bit pricey. Waiting until it's in the mid-$60 range could be a better bet.

Others see a more fundamental move higher. "I think any resolution clears a cloud over the stock and the stock will continue to trade up," says Benjamin Bollin, analyst at FTN Midwest Securities. In the next three to six months, Bollin expects RIM's price/earnings multiple to expand to 26 to 28 times forward earnings from its current 21 as legal uncertainties lift and investors again focus on the company's growth prospects.

If RIM can put this matter to bed, its stock will be more than a trade; it'll be an investment.