BigBand Networks (Redwood City, Calif.) filed a patent-infringement lawsuit against Imagine last month in the U.S. District Court for the District of Delaware, alleged that Imagine's products infringe three of BigBand's U.S. patents that cover video-processing and bandwidth-management techniques.

Imagine Communications was founded in 2005 by former BigBand employees.

In its counterclaim, Imagine stresses BigBand's patents are invalid and are unenforceable because of "inequitable conduct arising from BigBand's deceptive behavior during the patent application process that included withholding material information from the Patent Examiners who would not otherwise have allowed the patents."

It adds its video-processing and multiplexing technology involves a novel method of simultaneously improving bandwidth efficiency and video quality that is fundamentally different from BigBand's and any other competing techniques.

Imagine also said its solutions enable system operators to expand bandwidth without sacrificing video quality, allowing operators to rapidly expand advanced digital video services such as HDTV, VOD, and Switched Digital Video (SDV).

The company said it is still trying to understand why the suit was filed. Imagine's initial product and technology have not yet been commercially deployed so filing a lawsuit would seem ill-advised since BigBand cannot properly know or understand the details of Imagine's yet-to-be released technology to form the basis for a lawsuit, the compnay said in a statement.

"The only conclusion we can reach is that they initiated this suit to upset Imagine's financings and slow down introduction of Imagine's superior technology. In fact, when we heard rumblings that a lawsuit might be filed, we initiated CEO-to-CEO discussions and invited BigBand's CTO to our lab facility to demonstrate our dramatically different and non-infringing technology. They refused our invitation and sued us anyway," said Imagine's CEO Jamie Howard.

Howard added Imagine is also considering filing a suit for damages caused by BigBand trying to disrupt its financing and its commercial market entry.

Imagine has been testing its technology with various major cable operators and expects to commence initial product shipments by the fourth quarter of 2007. "In no way will BigBand's actions impinge on our ability to deliver on the promise of enabling unprecedented gains in bandwidth efficiency and video quality," said Howard.

In response to Imagine's accusations, BigBand vice president and general counsel Rob Horton said in a prepared statement: "Obviously, we're disappointed with Imagine's inflammatory statements, which go far beyond the allegations and any litigation privilege and further expose Imagine to yet more liability to BigBand."