Microsoft and TomTom Settlement

It has been announced that the long-running patent dispute between TomTom and Microsoft has been settled.

Microsoft has announced that a settlement has been reached in its dispute with TomTom over patent infringement. Proceedings brought by Microsoft in its home state of Washington, the proceedings Microsoft brought before the International Trade Commission and the proceedings brought by TomTom in Virginia have all been settled.

According to Microsoft, the cases have been settled through a patent agreement under which TomTom will pay Microsoft for coverage under the eight car navigation and file management systems patents in the Microsoft case. Also as part of the agreement, Microsoft receives coverage under the four patents included in the TomTom countersuit. The agreement, which has a five-year term, does not require any payment by Microsoft to TomTom. It covers both past and future US sales of the relevant products. The specific financial terms of the agreement were not disclosed.

The fact of such an agreement, reflecting (as one assumes it does) the strength of Microsoft’s case, may have implications for open source software vendors in many other fields, and in other jurisdictions. The case included an attack by Microsoft on the use of the ‘long file name’ feature of VFAT. This particular aspect of the case was of particular concern to Linux-supporters, as the ability to create, read, and write to FAT and FAT32 partitions is possible with Linux. Thus, Microsoft's assertion of its patents associated with such features was taken as an attack on Linux. Indeed, the settlement may have left some open source users jittery – at least that is one assessment of the statements released. For example, the Software Freedom Law Center released a statement saying:

[the settlement between Microsoft and TomTom ends one phase of the community's response to Microsoft patent aggression, and begins another. On the basis of the information we have, we have no reason to believe that TomTom's settlement agreement with Microsoft violates the license on the kernel, Linux, or any other free software used in its products. The settlement neither implies that Microsoft patents are valid nor that TomTom's products were or are infringing.
The FAT file system patents on which Microsoft sued are now and have always been invalid patents in our professional opinion. SFLC remains committed to protecting the interests of our clients and the community. We will act forcefully to protect all users and developers of free software against further intimidation or interference from these patents.
SFLC, working with the Open Invention Network and the Linux Foundation, is pleased to participate in a coordinated, carefully graduated response on behalf of all the community's members to ongoing anti-competitive Microsoft conduct. We believe in strength through unity, and we think our community's unity in the face of these threats has helped to bring about Microsoft's quick settlement on all issues with TomTom.

The Red Hat legal team released a statement:
Red Hat was not a party to this case. Even so, without a judicial decision, the settlement does not demonstrate that the claims of Microsoft were valid. Patent litigation is a difficult process, and there are many reasons besides the merits of the case that a defendant such as TomTom might have chosen to settle in the present economic environment. As the terms of the settlement license have not, to our knowledge, been made public, it is not possible to comment on their compliance with open source requirements and principles.

These statements may not be convincing, if only because the Red Hat statement seems to be anticipating trouble to come, but it is fair to report that some well informed commentators in the USA think that the settlement might represent a win for TomTom, although there is some rather contorted reasoning involved.

The Microsoft statement about the settlement gives more detail of its terms, but nothing truly illuminating is revealed.

The agreement includes patent coverage for Microsoft’s three file management systems patents provided in a manner that is said to be fully compliant with TomTom’s obligations under the General Public License Version 2 (GPLv2). TomTom will remove from its products the functionality related to two file management system patents (the FAT LFN patents), which enables efficient naming, organizing, storing and accessing of file data. TomTom will remove this functionality within two years, and the agreement provides for coverage directly to TomTom’s end customers under these patents during that time.

Horacio Gutierrez, corporate vice president and deputy general counsel of Intellectual Property and Licensing, Microsoft Corporation, stated:
‘We are pleased TomTom has chosen to resolve the litigation amicably by entering into a patent agreement. Our car navigation patents, which are at the heart of the enhanced auto experience enjoyed by millions of drivers today, have been licensed to many companies, including leaders in the car navigation sector. The file management system patents, which increase file management system efficiency and functionality, have also been licensed by many companies, including those that produce mixed source products. We were able to work with TomTom to develop a patent agreement that addresses their needs and ours in a pragmatic way. When addressing IP infringement issues, there are two possible paths: securing patent coverage or not using the technology at issue. Through this agreement, TomTom is choosing a combination of both paths to meet the unique needs of its business, and we are glad to help them do so.’

Peter Spours, Director of IP Strategy and Transactions at TomTom N.V., stated:
‘This agreement puts an end to the litigation between our two companies. It is drafted in a way that ensures TomTom’s full compliance with its obligations under the GPLv2, and thus reaffirms our commitment to the open source community.

 

 

 

Published: 2009-04-02T10:35:54

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