Samsung and Microsoft say they have settled their lawsuit over a patent licensing agreement that required Samsung to pay Microsoft for its use of Android, based on Microsoft’s claims that Google’s operating system runs afoul of its intellectual property.
The financial implications of the agreement are significant — Samsung paid Microsoft $1 billion under the deal in 2013, according to court records — but the terms of the settlement are being kept under wraps. The dismissal has been noted in the docket in the U.S. District Court for the Southern District of New York, without any details, and the companies declined to comment beyond this joint statement released on the Samsung and Microsoft websites.
“Samsung and Microsoft are pleased to announce that they have ended their contract dispute in U.S. court as well as the ICC arbitration. Terms of the agreement are confidential.” – Samsung’s Jaewan Chi, Executive Vice President and Global Legal Affairs & Compliance Team and Microsoft’s David Howard, Corporate Vice President and Deputy General Counsel.
Samsung is the largest maker of Android phones. The licensing agreement is one of a series of patent deals that Microsoft has struck with Android device makers. Samsung challenged the deal last year, citing antitrust concerns, following Microsoft’s acquisition of Nokia’s smartphone business.
Whatever the terms of the settlement, the effect of the agreement could ultimately be visible in Microsoft’s upcoming financial results. The company reports royalty revenue from the patent licensing deals as part of its Windows Phone results. Microsoft has been estimated to make as much as $2 billion each year from licensing its patents to makers of Android devices — much more than it makes on licensing Windows Phone to device makers.