Samsung could find itself in court again, after Microsoft announced it would sue the South Korean company in the US over unpaid late fees due on tardy smartphone royalties. According to Microsoft, Samsung has flouted the patent deal it agreed to in late 2011, which sees it hand over a fee based on every Android device it sells, and giving the Nokia Devices and Services acquisition as its justification.
Samsung had, until September 2013, been coughing up its required percentage, Microsoft deputy general counsel David Howard writes of the lawsuit’s motivations. However, since then, the checks
have stopped coming and instead Samsung has been supplying excuses.
[Update: Microsoft has clarified that the fees in dispute are actually late fees, after Samsung was slow to cough up what it owed. Samsung insists it does not owe Microsoft any such late fees and, according to the lawsuit – which you can read below – is threatening to withhold future payments.]
Samsung’s argument, as Howard recounts it, is that the acquisition of the Nokia divisions means the cross-licensing contract it signed is now invalid. “Curiously,” he writes, “Samsung did not ask the court to decide” whether that was actually the case legally, something he suggests was “likely because it knew its position was meritless.”
In fact, Howard hints at what Microsoft thinks is actually the case: namely that Samsung has done a whole lot better with Android than it necessarily expected to, and is now balking at handing over a percentage of every device sold to another company.
Muddying the waters, potentially, is the fact that while Samsung makes Android phones, it’s also a Windows Phone partner, though its investment in the platform has been comparatively slim. “Microsoft values and respects our partnership with Samsung,” Howard says, “and expects it to continue.”
Meanwhile, Samsung has been pushing ahead with Tizen, in what’s believed by many to be an attempt to minimize its dependence on Google’s OS and, as a happy side-effect, also cut what it potentially owes Microsoft. However efforts there have stumbled, with several delays of the new Samsung Z Tizen flagship.
The South Korean company will now “review the complaint in detail and determine appropriate measures in response” it said in a statement.
It’s unclear how much Samsung could potentially owe Microsoft for the year of unpaid dues, and nor is it certain whether Microsoft is hoping things go to trial or if this is all being used as a public shaming to encourage Samsung to open its wallet once more.