Slashdot Mirror
Microsoft Sued over Xbox Live
fiorenza writes "Ars Technica is reporting that Paltalk has sued Microsoft in the Eastern District of Texas over its Xbox Live service. The suit alleges that Microsoft's Xbox Live infringes on two of its patents, and that the company has suffered damages 'in at least the tens of millions of dollars,' which raises obvious questions about why they waited four years to file the suit (Xbox Live was launched in late 2002)." From the article: "Microsoft, as a company that runs multiplayer game servers, is alleged to be violating these patents. It's not clear how they're doing so--the initial complaint provides literally no evidence of Microsoft's guilt. The filing instead describes the Paltalk patents and the dates that Xbox Live went, err, live. After five pages of this, Paltalk simply claims that "gameplay on the Xbox or Xbox 360 through the Xbox Live online gaming service infringes the Paltalk patents," then goes on to ask for a jury trial. Presumably, actual information will be released once the trial begins."
In the best case scenario this is thrown out of court and Microsoft's lawyers actually get to earn their keep. No big deal other than a few sensationalist headlines every now and again. Isn't any press good press anyhow?
In the worst case Microsoft is seriously guilty of the claims of infringement. They end up paying a few tens of millions of dollars and having to pay to liscense the stolen technology in Live. But considering that Microsoft makes billions of dollars each year as a whole company and that the Xbox division dropped something like $4 billion on the Xbox, and probably a few extra billion on the Xbox 360 at this point, does an extra ten or twenty million dollars really matter?
Considering that Live is one of Microsoft's big selling points for their console, I seriously doubt that they would put themselves into a situation where they could no long offer it until they fixed parts to work around the infringement. Either they throw some chump change at some company or they don't. Business as usual in that the only real winners are the lawyers.
Blizzard's battle.net service? IIRC that was rolled out around 1997, wouldn't it be prior art then?
Its more the latter (M.A.D.). See the SCO v IBM case for an example. SCO sued IBM for, among other things, violating some patents they may-or-may-not hold (as a result of the "asset transfer"). IBM then countersued SCO for, among other things, violating their patents on stuff.
Companies with huge patent portfolios (IBM, Microsoft, Intel, etc) will usually set up cross licensing deals in the settlement process from an infringement lawsuit that will allow them to use patents without fear of suit.
There are only 10 kinds of people in this world... those who understand binary and those who don't
Microsoft is probably the most pro-patent reform of any US tech company. The problem is that, as cases like this show, they can't afford to not play the game... they just want the rules of the game to change.
Comment of the year
The entire point of patents is to protect an innovator from losses if/when some entity tries to profit from the innovator's hard work (without licensing it from the innovator.) If nobody's profiting (actually, if the innovator isn't losing anything -- an "entity" similarly can't start making widgets they don't own or license the patent for and give them away, no matter how altruistic their motives might be, because the patent holder is presumably losing money every time someone accepts the "free" widget instead of purchasing one from a licensee -- then there are no damages and there's no reason to file suit. It's entirely possible that Microsoft legitimately owes these folks a trunk of money, and it's just as likely that Microsoft will just cut 'em a check for whatever the market value is for the technology to just buy the patent and continue on their merry little juggernaut-jaunt -- one thing we can count on, though, is that Microsoft's more than willing to pay a few lawyers to push paperwork through the mill to see if they're legally obligated to write the patent holders a check (that much they've proven time and again)
Slashdot may be approaching the "breakover" point towards A.I.; the captcha on this post was "quagmire"... spooky!
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Actually a cold war is fairly accurate. Many patent rich companies use the patents they hold, that they know others are infringine upon as a defense to keep other patent rich companies from suing them.
Anytime a patent infringement lawsuit comes in they will examine the business of the one suing them to see which patents they can counter-sue on. Their goal is to counter sue for enough damages to exceed the original complaint.
Most companies in the computer industry know not to sue IBM because they hold so many patents that everyone is most likely infringing on. Occasionally some small company does attempt to sue them and IBM makes an example of them.
"Anything is possible with enough programmers, time and pizza." (Substitute caffeine for time as needed.)
I guess this is the American Way? Sue, sue & sue, its quite annoying. The only reason why they are doing this is because they know MS has loads of cash.