Microsoft pays $200 million to settle patent dispute

VirnetX a software company that owns patents for Virtual Private Networking (VPN) technology sued Microsoft for infringing on its patents. Microsoft will now settle the suit for $200 million according to InformationWeek. VirnetX claimed Microsoft was infringing on two of its VPN patents for automatic and secure VPN technology. The technology covered under the patents, created by VirnetX, was part of a security project they were working on for the Central Intelligence Agency.

The original complaint was filed February 15, 2007 by VirnetX and in March of this year a court in Texas ordered Microsoft to pay $106 million. After the verdict Microsoft said, "We respect others’ intellectual property, and we believe the evidence demonstrated that we do not infringe and the patents are invalid," according to Bloomberg.

Microsoft has since changed its mind and decided to end the legal battle by settling with VirnetX, the $200 million payment will give Microsoft a license to continue to use the technology in their products. Other aspects of the settlement were not disclosed. Companies including Cisco, Google, HP, AT&T, and Verizon and many others utilize their own VPN technology that may infringe on VirnetX's patents. This settlement could have a large impact on these companies, they may go to trial like Microsoft did originally or they may decide to bite the bullet and license the technology without a fight.

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