Microsoft's case against Samsung becomes clear, documents contain lots of fun information

Microsoft is not happy with Samsung right now and is taking the company to court over unpaid interest on a royalty payment. Now that the court documents are public, we read through them (so you don't have to) and pulled out some of the more interesting information.

Getting things kicked off, did you know that Microsoft spent $29 billion in R&D costs between July 1, 2010 and June 29th 2013? Neither did we, but we knew they always dumped a lot of money into this department and it looks like it averages out to about $10 billion a year; not a small chunk of change by any means.

As of June 30, 2013, Microsoft has more than 73,000 issued and pending patents and there are more than 1100 licensing agreements in place. Further, there are more than 25 companies who are licensing patents specifically for Android use.

That's a long black bar covering the interest owed.

Samsung claims that when Microsoft bought Nokia, its cross licensing agreement did not apply to the handsets that the company was now producing and that's the reason they held off on the payments; Samsung said that they were owed damages for their patents being used on Nokia devices.  Later in the year, they had a change of heart and paid Microsoft but did not include any interest on the funds that were held by Samsung that were rightfully Microsoft's. And while we do not know the amount that was owed to Microsoft, the black bar over the interest amount is rather long, fair to say it is not chump change. We do know, based on the document, that the value is above $75,000 as that is the minimum that is a threshold for the court that Microsoft filed the complaint.

Microsoft gave the press a causal shout-out too, noting that the speculation that Microsoft might buy Nokia's smartphone division was nothing new when the contract was signed.

While Samsung says that they are owed damages for the ongoing production of Lumia devices with Samsung IP, Microsoft's counterpoint, is that even if that is true (and they don't think it is true) that is not a valid reason to withhold the interest payment. Microsoft is also accusing Samsung of trying to convert a commercial contract dispute governed by U.S law into a Korean regulatory issue to avoid having to pay royalties.

To no surprise, Microsoft is requesting an unspecified amount of damages from Samsung along with the interest that is owed to them. The amount, like much of the document, is blacked out.

The basic argument is this: Samsung made a payment late and Microsoft wants interest on the late payment but Samsung believes that the Lumia devices Microsoft now makes are in violation of the cross licensing agreement.

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then if that is the case whre Samsung thinks they are owed. then they should sue over that in court instead of withholding payment on a contract.
a) Samsung should pay what is owed
b) Samsung should file suite over the dispute with the terms of the cross licensed agreement with nokia and Microsoft.....that is if Samsung truly believes that they have a case.

Samsung paid the royalty. That there is a simple admission of guilt. If Samsung or anyone else want to distribute Android without the two hundred odd patents it infringes all they have to do is write their own software. Why don't they?

Either pay the piper or make your own pipes. Stealing other people's software isn't the answer. Write your own. Simple really.

For the record, a piper is a musician. so that saying doesn't make sense.

I do agree though that companies that have legitimate claims to IP have the right to protect it, and calling everyone who litigates over IP theft or breach of contract patent trolls is damaging. It is almost impossible to attain investment funds or backers if you can't protect and enforce your IP rights so this is necessary. We know that msft invests heavily in research and delivers products, so they aren't trolling like large IP firms that just hold patents without using them.

Major_Plonquer said,
Samsung paid the royalty. That there is a simple admission of guilt. If Samsung or anyone else want to distribute Android without the two hundred odd patents it infringes all they have to do is write their own software. Why don't they?

Either pay the piper or make your own pipes. Stealing other people's software isn't the answer. Write your own. Simple really.

They are developing their own OS, but everyone talks about these patents that Android violates, but I never actually see a list. Where is that?

Not to mention, most patents are so broad and vague, it really depends on what jury/judge you get and not REAL validity.

if i could upload a word document here i would. anyway, if you want a list it's an easy bing/google search.
over 300 patents are at issue/claimed.

farmeunit said,

They are developing their own OS, but everyone talks about these patents that Android violates, but I never actually see a list. Where is that?

Not to mention, most patents are so broad and vague, it really depends on what jury/judge you get and not REAL validity.

rocksturdy said,
if i could upload a word document here i would. anyway, if you want a list it's an easy bing/google search.
over 300 patents are at issue/claimed.

Yup more then 200 ridiculous patents which would be invalidated in Germany, Netherlands, France, UK etc etc.

US patents are ridiculous. Everyone wants to become a lawyer these days and there is quite a bit of work for them just because those stupid patents. Starting companies are destroyed in a week by other companies because of those "rounded corner" patents.

Seahorsepip said,

Yup more then 200 ridiculous patents which would be invalidated in Germany, Netherlands, France, UK etc etc.

US patents are ridiculous. Everyone wants to become a lawyer these days and there is quite a bit of work for them just because those stupid patents. Starting companies are destroyed in a week by other companies because of those "rounded corner" patents.

I thought "rounded corners" was argued as a "trade dress" not a patent?

Seahorsepip said,

Yup more then 200 ridiculous patents which would be invalidated in Germany, Netherlands, France, UK etc etc.

US patents are ridiculous. Everyone wants to become a lawyer these days and there is quite a bit of work for them just because those stupid patents. Starting companies are destroyed in a week by other companies because of those "rounded corner" patents.

Here is the thing, you are saying that based on only skimming the patent titles, maybe reading a few summaries. A patent is all about the details. The descriptions almost always sound vague or repetitive, because the patent itself only focuses on one small process or design improvement, and that information is only found in the detailed section that no one ever reads. Everything else about the original design is not part of the patent and may still be used by others.

It is rare that a single patent introduces an revolutionary new concept no one has even remotely considered before. But uninformed critics seem to think those are the only valid patents.

I am not saying there are not dumb patents out there, I would like to see a peer review requirement added to the patent process to help weed junk patents. But it is foolish to state that every patent falls into that category. Or, every patent owned by company X which you are not a fan of, must be invalid.

Great article. That clears a lot up.
Does anybody know if Microsoft charges for use of these essential patents with Windows Phone, or is it just Android?
If not it seems a bit weird, and maybe something the lawyers will latch on to, but I guess that's MS' prerogative to give Windows Phone a leg up.
Maybe Samsung should cut a deal on the missing interest and start shipping more Windows Phones.

mildmanneredjanitor said,
Great article. That clears a lot up.
Does anybody know if Microsoft charges for use of these essential patents with Windows Phone, or is it just Android?
If not it seems a bit weird, and maybe something the lawyers will latch on to, but I guess that's MS' prerogative to give Windows Phone a leg up.
Maybe Samsung should cut a deal on the missing interest and start shipping more Windows Phones.

Up until MS made WP licensing $0 the license fee you paid covered the patents used on the platform.

They clearly owe them a staggering amount of money.
If it costs Samsung just 2% of that figure to try it on in court and have a remote chance of getting away without paying it, they're obviously going to try it on, its just business.

Getting things kicked off, did you know that Microsoft spent $29 billion in R&D costs between July 1, 2010 and June 29th 2013?

That's pretty irrelevant when most of the patents it uses to sue to Android with are pre-mobile < 2000.

simplezz said,
That's pretty irrelevant when most of the patents it uses to sue to Android with are pre-mobile < 2000.

Actually if you look over the list that was leaked the majority of them are specifically about mobile, some deal with technologies that didn't even exist before 2000.

Max Norris said,

Actually if you look over the list that was leaked the majority of them are specifically about mobile, some deal with technologies that didn't even exist before 2000.

Take a look yourself:
http://images.mofcom.gov.cn/pe...1404/20140408143130296.docx

Admittedly that's not all of them, but it's the 100 most important focused on. Guess what no 1. is? FAT (Common Name Space for Long and Short Filenames). Surprise, surprise.

Then you've got nonsense like 'System Provided Child Window Controls', 'Context Sensitive Menu System/Menu Behavior', 'Method And System For Configuring A Timer', and 'Loading Status in a Hypermedia Browser Having a Limited Available Display Area'. How any of them were approved for patents is beyond me. And yes, I've looked beyond the summary of all of them.

simplezz said,
Admittedly that's not all of them, but it's the 100 most important focused on. Guess what no 1. is? FAT (Common Name Space for Long and Short Filenames). Surprise, surprise.

Yes, looked at that list, although that's the short version, there's another with over 300 patents listed. #1 on the list doesn't make it #1 of importance, it's the lowest number because it's the oldest ;) And yet always brought up like it's the only one.. some people just focus on that for some reason and completely disregard the rest.

simplezz said,
How any of them were approved for patents is beyond me. And yes, I've looked beyond the summary of all of them.

Sure, some patents are a tad vague, write a letter to your congressman about that one. Again, that's hardly unique to Microsoft.

Max Norris said,

Yes, looked at that list, although that's the short version, there's another with over 300 patents listed. #1 on the list doesn't make it #1 of importance, it's the lowest number because it's the oldest ;) And yet always brought up like it's the only one.. some people just focus on that for some reason and completely disregard the rest.


Sure, some patents are a tad vague, write a letter to your congressman about that one. Again, that's hardly unique to Microsoft.

The people claiming M-dollar only has that one patent to stand on are living a FAT lie.

If things are the way they are put in the article then Samsung's move makes no sense.

If you think you are owed some kind of damages then witholding payment of other royalties will do nothing but hurt your own case.

if definitely looks like an open and shut. it might not even reach trial.

ichi said,
If things are the way they are put in the article then Samsung's move makes no sense.

If you think you are owed some kind of damages then witholding payment of other royalties will do nothing but hurt your own case.

Whith the walloping Samsung has been getting vs apple you would think they wouldn't try it with Microsoft who have more patents then apple.

Maybe I'm wrong, but given that this is a Civil case and is a matter of public record, why is anything at all redacted from the case files?

Nothing is redacted. Steven Sinofsky was just trying to draw some Metro tiles on the paperwork because he was bored.

Do you even read articles, or just blindly write hateful and senseless replies?
And Samsung has built its business on countless patents, among many other things. Hell, almost a thousand US patents were granted (granted, not published) to Samsung last month alone.

Avatar Roku said,
Funny to see Samsung make a complaint about patent infringement. They built their entire business on theft.

What Samsung stole?.

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