Microsoft Settles InterTrust Patent Suit

http://biz.yahoo.com/ap/040412/microsoft_intertrust_6.html

Microsoft Settles InterTrust Patent Suit
Monday April 12, 8:51 am ET  
Microsoft Pays $440 Million to InterTrust Technologies to Settle Patent
Infringement Lawsuit 

REDMOND, Wash. (AP) -- Microsoft Corp. is paying $440 million to InterTrust
Technologies Corp. to settle a three-year-old patent infringement lawsuit
over technology for protecting music, movies and other digital content
against piracy.

Monday's announcement marked the second settlement this month by the world's
No. 1 software company. Microsoft agreed about two weeks ago to pay Sun
Microsystems $1.6 billion to settle a private antitrust suit and resolve
patent claims.

The settlement with InterTrust, of Santa Clara, Calif., resolves all legal
issues between the two companies and grants Microsoft a license to
InterTrust's patents on digital rights management, code designed to prevent
the unauthorized copying of files, the companies said.

A key function of DRM is to limit the number of copies that can be made from
a song or movie that is downloaded over the Internet -- a growing business
as the distribution of entertainment goes increasingly digital.

The settlement is part of an effort "to provide peace of mind for our
customers and partners by letting them know that patent licensing is our
responsibility," said Marshall Phelps, Microsoft deputy general counsel and
corporate vice president of intellectual property, or IP.

With the agreement, customers can use Microsoft products and services
without a license from InterTrust. Developers, however, may need a license
from InterTrust for other uses, including the combination of Microsoft
technology with third-party technology, according to the joint statement.

InterTrust, owned by a joint venture of Sony Corp., Philips Electronics NV
and the investment banking company Stephens Inc., sued Microsoft in April
2001.

At the time, InterTrust officials talked of trying to halt sales of the
then-new Windows XP operating system and said damages could amount to
billions of dollars.

The lawsuit followed a breakdown in licensing talks in 1998-2000, when
Microsoft was considering an investment of more than $100 million in
InterTrust. Settlement talks began at the urging of a judge last summer.

Last month Microsoft agreed to settle a patent lawsuit filed by AT&T Corp.
over voice-recognition technology for terms that were not disclosed.

Last year Microsoft settled claims by Time Warner Inc. involving Netscape
Communications, now owned by Time Warner's America Online unit, and paid $35
million to settle a case brought by Immersion Corp. over joystick
technology.

Received on Monday, 12 April 2004 09:21:57 UTC