Microsoft sues Samsung over Android non-payment

Microsoft has filed suit against Samsung after the Korean electronics giant stopped paying the US company for access to IP essential to the use of the Android operating system.

Microsoft is claiming that its acquisition of Nokia’s devices business is the cause of the contract breakdown, suggesting that Samsung now sees Microsoft as a rival.

The companies entered into a legally binding contract in 2011, which saw Microsoft cross-licensing Android IP to Samsung.

But according to David Howard, Corporate Vice President & Deputy General Counsel, Microsoft, since Samsung entered into the agreement, its smartphone sales have quadrupled and it is now the leading worldwide player in the smartphone market.

“Consider this: when Samsung entered into the agreement in 2011, it shipped 82 million Android smartphones. Just three years later, it shipped 314 million Android smartphones. Samsung predicted it would be successful, but no one imagined their Android smartphone sales would increase this much,” he said.

“After becoming the leading player in the worldwide smartphone market, Samsung decided late last year to stop complying with its agreement with Microsoft. In September 2013, after Microsoft announced it was acquiring the Nokia Devices and Services business, Samsung began using the acquisition as an excuse to breach its contract. Curiously, Samsung did not ask the court to decide whether the Nokia acquisition invalidated its contract with Microsoft, likely because it knew its position was meritless.”

Howard said that after spending months trying to resolve the disagreement, Samsung has made clear in a series of letters and discussions that we have a fundamental disagreement as to the meaning of our contract. “We are simply asking the Court to settle our disagreement, and we are confident the contract will be enforced,” he added.