AMS files patent lawsuit against BI in Colorado's Federal District Court

Denver-based Alcohol Monitoring Systems (AMS) filed suit today in Colorado's Federal District Court asserting that Boulder-based BI Incorporated, a pending acquisition of The GEO Group, has infringed multiple patents with their BI TAD (Transdermal Alcohol Detection) system. The GEO Group is one of the nation's largest operators of correctional facilities.

According to AMS Chairman and CEO Mike Iiams, his company made the decision to file the suit after multiple attempts to work with BI executives and resolve the infringement issues. "We made every attempt to resolve the issue without litigation. Now, we will vigorously defend our intellectual property within the courts," he said.

AMS manufactures the widely used SCRAMx (Secure Continuous Remote Alcohol Monitor) System, which was originally launched to the corrections market in July of 2003. Worn on the ankle 24/7, the system samples a subject's perspiration for the purposes of monitoring alcohol consumption. Known as transdermal alcohol monitoring (or continuous alcohol monitoring), SCRAMx has monitored more than 165,000 offenders in 48 states to-date.

According to Iiams, AMS holds a number of patents that cover the essential technology that BI Incorporated now improperly uses in its BI TAD. The AMS patents make it possible to capture transdermal alcohol readings in real-time and generate evidence of a violation that is admissible in court.

The GEO Group announced their $415 million acquisition of BI Incorporated in December of 2010. The transaction is expected to close on February 10, 2011.