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Microsoft sues Immersion for contract breach

19 June 2007 19:31 by Andre "DVDBack23" Yoskowitz | 7 comments

On Monday, Microsoft announced that it had filed suit against Immersion, just weeks after the company settled its legal battle with Sony. Microsoft said there was a breach of contract due to the settlement, which was over the patent right for rumble controllers.

"We entered into a binding licensing agreement with Immersion and are seeking to have that agreement honored," Microsoft Associate General Counsel Steve Aeschbacher said to CNET in a statement. "Microsoft licenses technology both in and out and relies on these agreements to be honored and enforced. Our request to the court is that all companies and industry partners should play by the same rules and that the binding agreement we signed with Immersion be honored."

Throughout 2002 and 2003, Immersion was trapped in legal battles with Sony and Microsoft over their vibrating controllers and Sony eventually lost while Microsoft negotiated a royalty payment program with Immersion.

"In particular, it provides that if Immersion settles the Sony Lawsuit ... for an amount up to $100,000,000, Immersion shall pay Microsoft the sum of $15,000,000. If Immersion settles the Sony Lawsuit for an amount between $100,000,000 and $150,000,000, Immersion shall pay Microsoft an additional amount equal to 25% of the amount of the settlement in excess of $100,000,000. If Immersion Settles the Sony Lawsuit for an amount in excess of $150,000,000, Immersion shall pay Microsoft an additional amount equal to 17.5% of the amount of the settlement in excess of $150,000,000."

Immersion acknowledged the agreement but did not agree that any form of payment was obligatory.

"The Company has determined that the conclusion of its litigation with Sony Computer Entertainment does not trigger any payment obligations under its Microsoft agreements. However, in a letter sent to the Company dated May 1, 2007, Microsoft disputed the Company's position and stated that it believes the Company owes Microsoft at least $27.5 million. If Microsoft brings a lawsuit to further dispute the Company's position, the Company intends to oppose Microsoft's claims and vigorously defend the Company's position."

"The Company believes that it is not obligated under its agreements with Microsoft to make any payment to Microsoft relating to the conclusion of the patent litigation with Sony Computer Entertainment. However, it is uncertain that Microsoft will accept the Company's position or that the Company will ultimately prevail with its position... In the event that Microsoft were to prevail, the Company would be obligated to pay Microsoft a minimum of $15.0 million for any amounts received from Sony up to $100.0 million, plus 25% of any amounts over $100.0 million and up to $150.0 million and 17.5% of any amounts over $150.0 million."

Immersion has not responded to the lawsuit yet.

Source:
Dailytech

Permalink to this article

Sony sued over PS3 feedback patents (24 April 2009)

Immersion to pay Microsoft over controller dispute (27 August 2008)

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Discuss this article!
rainofire (Newbie) 19 June 2007 20:16
OMG not another lawsuit. [ + quote]
pisho (Junior Member) 19 June 2007 21:20
I do no understand why immersion would even sign that in the first place. what does the lawsuit between sony and immersion have to do with microsoft? [ + quote]
Riotard (Newbie) 20 June 2007 1:34
Pisho two words 'CONSOL WAR' This is quite a blow to the 360 fight against the wii, because now it isn't the only consol that can have rumble tech in their controllers. But it'll probably be a few years becfore sony bring out their controller with a rumble pack, if they did, battery life is gonna need to be increased dramatically! [ + quote]
MightyOne (Junior Member) 20 June 2007 5:41
Quote: Microsoft licenses technology both in and out and relies on these agreements to be honored and enforced. Ya Ya... just like the world relied on an html standard that u, microsucks decided to add personalized tags to and not keep the standard. To this day corporations have problems with HTML mail merges in MS Word just because of you didn't follow the rules. You can dish it out...but u can't take it. Your gonna be bending over some day Microsucks....and i'll be waiting with my plunger !!! [ + quote]
jimmer (Newbie) 20 June 2007 11:52
so if microsoft wins, it'll be like sony putting money into microsofts pockets. lol [ + quote]
scorpNZ (Senior Member) 21 June 2007 19:22
good call jimmer lmao [ + quote]
borhan9 (AfterDawn Addict) 21 June 2007 20:46
These are some big numbers some heads are going to roll either way this one will go :) [ + quote]