Last night we reported that Microsoft has filed a legal action against Samsung in U.S. District Court, Southern District of New York. The reason was that Samsung has stopped paying patent royalties as per the contract it signed in 2011 citing lame reasons like Microsoft acquired Nokia’s Devices and Services business. David Howard, Corporate Vice President & Deputy General Counsel at Microsoft said, “After spending months trying to resolve our disagreement, Samsung has made clear in a series of letters and discussions that we have a fundamental disagreement as to the meaning of our contract.” Microsoft’s complaint to the court is now available online. You can read it below. Here is the summary of the document,
- Samsung signed patent cross licensing agreement with Microsoft and agreed to pay royalties to Microsoft for its Android based products.
- Samsung is now refusing to pay this year’s royalty along with the interest for late payment.
- Samsung’s main reason for not paying royalty this year is that they believe Microsoft has breached the contract by acquiring Nokia’s business.
- Microsoft’s argument is that Nokia related acquisition does not affect the patent licensing agreement it had with Samsung.
- Also, Samsung has finally paid the FY2 royalty but refusing to pay the interest for late payment.
- Samsung believes that Microsoft’s smartphones (after Nokia’s acquisition) are not covered under Samsung patent licensing agreement. Microsoft disagrees on that front as well.
- Samsung is also trying to take this commercial patent licensing agreement issue into a regulatory issue in Korea.
- Samsung has asked Korean competition authorities to change relieve Samsung from paying Android related royalty payments to Microsoft.
The most interesting thing from of the document(Thanks to Todd from GeekWire) is that Samsung is threatening to sue Microsoft for Lumia based devices.