Microsoft brings a civil action against Samsung
Microsoft said Friday it is suing Samsung for threatening to
stop paying Microsoft royalties for patents behind the Android operating
system.
The two companies came
to a deal in September 2011 to cross-license each other's patent portfolios.
Samsung wound up paying Microsoft royalties on a series of patents.
Analyst Rick Sherlund of
Nomura Securities has estimated royalties on its Android patents bring
Microsoft nearly $2 billion a year.
Microsoft, based in
Redmond, Washington, says more than 25 companies are licensing the patents,
including Samsung, Acer and ZTE, covering roughly 80 percent of the
Android-based smartphones sold in the U.S.
Microsoft Corp.'s deputy general counsel said Samsung Electronics Co. Ltd.
decided to breach its contract after Microsoft announced in September it was
acquiring Nokia's devices business.
After initially refusing
to pay royalties in the second year of the deal, Samsung made a late payment in
November but did not add on interest, according to a redacted copy of the
complaint filed in federal court in New York and provided by Microsoft.
The complaint also
alleged that Samsung has asked South Korean competition authorities to change
the contract to reduce or eliminate its payments to Microsoft.
Samsung said in a
statement, "We will review the complaint in detail and determine
appropriate measures in response."
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