The complaint, filed in U.S. District Court in Delaware, asked that Palm and Handspring stop selling handhelds until the patent claims are settled. It also asked the court to award NCR a "reasonable royalty," plus additional damages to be paid by Handheld and Palm of as much as three times that amount.

"NCR allocates considerable resources to the research and development of its products and business solutions, and we will aggressively assert our legal rights to protect our patent portfolio," said John Hourigan, NCR's director of corporate media relations.

Handspring vowed to fight the action.

"We feel these claims are without merit and we are working with Palm to defend against them," said Handspring spokesperson Brian Jaquet. A spokesperson for Palm Thursday afternoon said "we have not been served, so I'm not in a position to comment."

The suit claims that NCR received two patents in 1987 that evolved out of a product developed by its researchers. One patent covers "a portable terminal small enough to fit in the user's hand," according to the complaint. The second patent covers the system that included both the device and the docking station.

The complaint says that NCR's researchers, "recognized an unsatisfied need for a portable, handheld device which would allow the user to information such as appointments, to-do lists, and addresses, and execute financial and shopping transactions by connecting to networks using an interface module."

The complaint also alleges that Palm and Handspring knew about the patents but chose not to license the technology.

"Instead, in total disregard of NCR's patent rights, Palm and Handspring both chose to use the inventions that had been developed and patented by NCR without paying for them," the suit alleges.

NCR asked that the case be heard by a jury.