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US: Microsoft, Samsung feud over Nokia buyout heats up

 |  August 4, 2014

Microsoft has filed a lawsuit against South Korea’s Samsung Electronics, a move that is heating up a disagreement between the two over patent royalty payments.

According to reports, Microsoft and Samsung signed a contract in which Samsung agreed to pay patent royalties to Microsoft. But after Microsoft’s decision to acquire Nokia’s handset operations, Samsung has refused to pay those royalties.

Samsung reportedly argues that the 2011 agreement to pay royalties on Microsoft patents does not apply to products sold by Microsoft after its acquisition of Nokia. Microsoft agrees, and has now filed a lawsuit against Samsung, which Microsoft says eventually paid the disputed royalties but has refused to pay interest.

According to reports, Microsoft first began seeking royalty payments from handset makers to ramp up its ability to compete in the smartphone market. Samsung, LG and HTC have all signed agreements to do so. Motorola, however, has refused to sign the agreement; the companies have been involved in a separate legal battle since 2010 over the dispute.

Microsoft is seeking monetary recover from Samsung but the company has not publicized exactly how much it is seeking.

Samsung has previously expressed disapproval of Microsoft’ acquisition of Nokia, arguing that Nokia is now demanding higher patent likening fees from the company following Microsoft’s acquisition. Nokia was feared to become a patent troll after Microsoft acquires its handset operations, leaving Nokia to evolve into a company that depends on its intellectual property for profits.

Full content: Reuters

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