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."

Comments

Re:Is this really such a big deal for Microsoft?

[cybereal]

You seem to have missed about half the point here. You are correct about the costs being insignificant to the XBOX project for Microsoft. Well, not entirely insignificant, but certainly nowhere near untenable.

However, the real point of this article is about the patent trolls. If you look at it as a case as MS having to decide if paying for trials or paying the desired settlement (which is bound to be less than what is asked in the trial itself) then you'll see that MS may be better off just paying these guys without a trial. This is a serious problem with the legal system.

You see, if Microsoft decided to take this to court, and they won, then a precedent would be set for similar cases in the future. This precedent would serve the smaller companies that can't really afford to pay out settlements. But instead, MS will probably just settle and give into this extortion and future cases just like this will continue to come about with no new ammunition against them.

It's unfortunate but, our legal system relies heavily on precedents and if none are set, well, no progress is ever made.