Microsoft sues Samsung over unpaid Android patent royalties

Posted:
in General Discussion edited August 2014
Microsoft on Friday filed a lawsuit with a New York district court claiming Samsung is in breach of an Android patent cross-licensing contract after failing to turn over an undisclosed amount in royalty payments.

Samsung


While the court filing has yet to be made public, Microsoft's deputy general counsel David Howard offered a brief overview of the complaint in a post to the company's official blog.

"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," Howard writes.

Samsung apparently decided to break a 2011 patent licensing deal in which the Korean company agreed to pay Microsoft royalties on sales of smartphones and tablets running the Android operating system. Microsoft has secured a number of similar IP licensing deals with various device manufacturers.

According to Howard, Samsung is attempting to sidestep the contract by saying Microsoft's purchase of Nokia invalidated the agreement.

"In September 2013, after Microsoft announced it was acquiring the Nokia Devices and Services business, Samsung began using the acquisition as an excuse to breach its contract," Howard writes. "Curiously, Samsung did not ask the court to decide whether the Nokia acquisition invalidated its contract with Microsoft, likely because it knew its position was meritless."

Howard notes Samsung's huge share of the Android device marketplace, and therefore the smartphone market as a whole, saying the Korean tech giant stopped complying with contract terms "late last year." Interestingly, Samsung reported disappointing earnings on Thursday, citing heightened competition in the smartphone space.

As for the lawsuit's future, Samsung has yet to issue an official response, though Howard feels a copacetic conclusion can be reached in court.

"Microsoft values and respects our partnership with Samsung and expects it to continue," he writes. "We are simply asking the Court to settle our disagreement, and we are confident the contract will be enforced."
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Comments

  • Reply 1 of 72
    and still their profits were down.... Amazing.

    Their Legal department must love attending strategy meetings, Either they are gluttons for punishment or just enjoy the blood lust of courtroom battle.
  • Reply 2 of 72
    SpamSandwichSpamSandwich Posts: 33,408member
    Oh, this is going to be good.
  • Reply 3 of 72
    jkichlinejkichline Posts: 1,348member

    Samsung is a shameful company. In what world would an acquisition mean that you no longer need to uphold your contracts?

  • Reply 4 of 72
    rob53rob53 Posts: 2,491member

    When will the US government and judicial system actually force Samsung to pay up or risk an ban on all Samsung devices? Samsung has shown it has no intention of paying any of its fines or contractual responsibilities (royalties). Isn't this enough for an import ban?

  • Reply 5 of 72
    They stopped paying royalties as per licensing agreement without going to court first? Can we just do that whenever we feel like it?
  • Reply 6 of 72

    Ah, Samsung.  The American-attacking company fueled by Google.

     

    Nice work Google.

  • Reply 7 of 72
    zoffdinozoffdino Posts: 192member

    I hate Samsung and hope that they get their ass whipped in this case. However, without seeing for full story from both sides, it's impossible to tell who's right and who's wrong. The contract may prohibit Microsoft from making Android phones, or using certain Samsung patents.

     

    Anyway, it's nice to see that Samshit is being dragged to court once again.

  • Reply 8 of 72
    A court decision determining that Samsung must pay royalties as defined by contract and court decision will have little impact on Samsung if they still refuse to pay. The only action that will ensure that Samsun complies is for US and EU to sanction Samsung by allowing the seizure and sale of Samsung property. An important ban would be the second choice. Unfortunately, it does nothing to compensate Microsoft or any other company harmed by Samsung's illegal actions.
  • Reply 9 of 72
    zoffdinozoffdino Posts: 192member
    Quote:

    Originally Posted by macaholic_1948 View Post



    A court decision determining that Samsung must pay royalties as defined by contract and court decision will have little impact on Samsung if they still refuse to pay. The only action that will ensure that Samsun complies is for US and EU to sanction Samsung by allowing the seizure and sale of Samsung property. An important ban would be the second choice. Unfortunately, it does nothing to compensate Microsoft or any other company harmed by Samsung's illegal actions.

    I'm sure the contract has a penalty clause in case one side doesn't comply with the terms. Breaking commercial contracts is a big deal. It's even scarier when you do so against a giant who has a bottomless pit of money to throw at its lawyers. If Samsung is found guilty we can surely expect some big damage claim from Microsoft.

  • Reply 10 of 72
    disturbiadisturbia Posts: 563member

    Oh boy!

     

    Microsoft is NO Apple. Apple is soft ... Microsoft ....well.... :smokey:

    .

    .

    .

    .

    On another note, needed a shiny new SSD for my office PC (running Win7 :embarrass)!

     

    The sales guy tried his best to sell me one from Samsung. :\ And, looking at price and specs, I was soooooo very close .... :no:

     

    Left the store with one from OCZ! Cost a little more ... but you know what? I didn't give my $$ to Sammy! That made me smile! :p 

  • Reply 11 of 72
    zoffdino wrote: »
    I'm sure the contract has a penalty clause in case one side doesn't comply with the terms. Breaking commercial contracts is a big deal. It's even scarier when you do so against a giant who has a bottomless pit of money to throw at its lawyers. If Samsung is found guilty we can surely expect some big damage claim from Microsoft.
    It does not matter what damages the court offers up if Samsung refuses to pay up. The only remedy that Microsoft will have if Samsung does not comply is seizure of Samsung property. This could include product shipments at their point of entry. The US government could set sanctions but that does not pay Microsoft back.
  • Reply 12 of 72
    quinneyquinney Posts: 2,528member
    Screw the courts. Hire a Kuklinsky.
  • Reply 13 of 72
    I'm sure that after spending years losing to Apple with its patent suits, and still not having to pay Apple a dime, they've decided the US court system has no teeth to hurt them. Apple recently dropped its years long battle to ban import of some Samsung devices because the case took so long it no longer mattered. Samsung had made its billions stealing Apple's intellectual property, and even lost in court twice, and still owes Apple $1 billion in settlements. No trade organization is ever going to ban Samsung's current products to enforce a contract. So, why pay Microsoft anything? If Apple couldn't stop them, what are Microsoft's chances?
  • Reply 14 of 72
    jungmarkjungmark Posts: 6,802member
    C
    U
    Next
    Tuesday
    Sammy.
  • Reply 15 of 72
    Hopefully a bunch more people who like Microsoft also start boycotting Samsung.
  • Reply 16 of 72

    is it?

  • Reply 17 of 72
    mhiklmhikl Posts: 471member

    Won’t everyone stop picking on SamSlug. It’s suffering into late stages decrepitude and mindfogitude. It’s a misery for sure so we should all have a heart. Next fridge you need, make sure its Sams.

    And dying at the starting gate, whose first out of the gate in failed projects, MS or SS? Me thinks MS is tossing the goo that slapped it in the face. It’s a merry-go-aground and a farce-Wheel at the playground boys and girls. But hey, its summer. Party On.

  • Reply 18 of 72
    sleakajsleakaj Posts: 32member
    Quote:

    Originally Posted by Disturbia View Post

     

    Oh boy!

     

    Microsoft is NO Apple. Apple is soft ... Microsoft ....well.... :smokey:

    .

    .

    .

    .

    On another note, needed a shiny new SSD for my office PC (running Win7 :embarrass)!

     

    The sales guy tried his best to sell me one from Samsung. :\ And, looking at price and specs, I was soooooo very close .... :no:

     

    Left the store with one from OCZ! Cost a little more ... but you know what? I didn't give my $$ to Sammy! That made me smile! :p 


     

    I've got some bad news for you, the Samsung SSDs are more reliable than the OCZ SSDs.

     

    I'm not fond of Samsung either, but make a smart choice, not one based on defiance.

  • Reply 19 of 72

    Where's GatorGuy? How many times has he run his trap claiming there's no "proof" MS actually collects royalties from Samsung (or anyone else) over MS IP in Android. Or that Android even infringes MS IP?

     

    No, seriously, he has actually stated that numerous times. Would love to hear his spin on this case.

  • Reply 20 of 72
    ronboronbo Posts: 669member

    Hey AI...

     

    Are you planning to finish that last sentence?

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