TomTom Settles Patent Fight With Microsoft

Microsoft announced Monday that it has settled its month-old patent infringement lawsuit against GPS navigation device maker TomTom — quieting a spat that for a time had sparked the concern of open source advocates and other critics of the software giant.

The software giant sued Amsterdam-based TomTom in late February, claiming the navigational device company violated eight of its patents.

The settlement stands as a remarkably quick resolution to the matter, considering the frequently litigious nature of the technology industry. Under the terms of the agreement, Microsoft (NASDAQ: MSFT) said TomTom has agreed to pay to license the eight Microsoft patents.

In return, TomTom has agreed to drop a countersuit that it filed in mid-March, which alleged Microsoft in turn had been infringing four its patents. Financial terms of the deal were not disclosed.

“We are pleased TomTom has chosen to resolve the litigation amicably by entering into a patent agreement,” Horacio Gutierrez, Microsoft’s deputy general counsel of intellectual property and licensing, said in a statement.

The settlement, which has a five-year term, provides for both companies to be protected from being sued by the other for infringing the total of 12 patents at issue, as well as providing patent suit protections for customers. Even better, Microsoft and TomTom say, the deal doesn’t clash with open source licenses.

“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 [General Public License version 2], and thus reaffirms our commitment to the open source community,” Peter Spours, director of IP strategy and transactions at TomTom, was quoted in the Microsoft statement as saying.

That’s at least partly because under one aspect of the deal, TomTom agreed it will phase out the use of three Microsoft patents for system file management in its devices over the next two years.

Two of those three involve Microsoft File Allocation Table (FAT) technologies, and the third one is about reading and writing file information to flash memory. The other five Microsoft patents are related to navigation system functions.

Initially, open source advocates and critics saw a Microsoft attempt to make a surprise end run on its threats against Linux; however, that possibility seems out of the question now. Additionally, some critics had hoped that the case would bring up challenges to the validity of at least the two FAT patents, which withstood a reexamination by the United States Patent & Trademark Office (USPTO) two years ago.

However, the settlement demonstrates that the suit — at least in this case — had aimed to get TomTom to the bargaining table.

When they filed the lawsuit, Microsoft officials had said that they had been trying to negotiate over patent licensing with TomTom for more than a year. If the idea was to jumpstart licensing talks, Microsoft’s maneuver certainly worked.

TomTom did not note the settlement on its Web site. “I can confirm that we have reached a settlement and it ends all legal issues between the two companies,” a TomTom spokesperson reached by said. However, the spokesperson declined to answer further questions regarding the settlement.

Meanwhile, the settlement helps to clean one more item off of Microsoft legal’s to-do list — but plenty of litigation remains.

For instance, Israel-based BackWeb Technologies last week sued Microsoft for violating two of its patents in Windows Update and other update applications.

Additionally, Microsoft is nearing trial in April in its so-called “Vista capable” lawsuit. In that case, consumers sued Microsoft for deceptive practices during the 2006 holiday shopping season, claiming that they had been tricked by advertising into purchasing low-end PCs that could not run premium versions of Windows Vista.

In the latest twist in that suit, the judge in the case recently refused to reinstate the plaintiffs’ suit as a class action.

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