Microsoft launches latest volley in patent licensing war with InterDigital

The complaint was filed in a federal court in Wilmington, Delaware, and adds to the long-fought patent-licensing battle between the two tech giants. The company says that InterDigital’s license practices are not only detrimental to the handset space, but also a violation of federal anti-monopoly laws. Microsoft is trying to not only win the ITC case, but prove that InterDigital is in fact violating anti-trust provisions by cornering the market on mobile technologies and then holding the companies that actually do create real products hostage by charging far more than “fair and reasonable terms” for the patents. In the case of Microsoft and InterDigital, the issue has exploded spreading into three continents and attracting the attention of courts, regulators and boards in the process. The court found some Microsoft handsets infringed two InterDigital wireless patents and its 3G devices could potentially be banned from sale in the US.

An ITC judge had initially ruled that Microsoft Corporation (NASDAQ:MSFT) infringed on patents for moderating mobile phones ability to reduce signal interference.

In the new lawsuit, Microsoft said that because of InterDigital’s “monopolistic conduct”, the court should triple any damages it awards, and order InterDigital to stop enforcing its patents. Microsoft claims that InterDigital exceeded the appropriate limit. The full commission is considering the judge’s findings and is scheduled to release its final decision on August 28.

Microsoft executives are definitely nervous at this point.

The lawsuit concerns patents considered to be critical to technologies that may be widely adopted in an industry.

The two companies are already involved in a patent lawsuit at the U.S. worldwide Trade Commission that dates back to 2007, prior to Microsoft’s purchase of Nokia’s devices and services division in 2013. In the same time period, the company lost its position as the third-largest handset manufacturer in the world.

Recently, Microsoft launched Windows 10, with which it aims to unify PC and mobile platforms.

Microsoft has been struggling with its mobile phone business since a while, and may suffer another blow if the ITC places a ban on its imports. On the other hand, InterDigital does not create anything with those patents. The ITC judge also said there was evidence Microsoft had engaged in “reverse patent holdup”, a situation where a company uses technology covered by a patent but refuses to pay for a license.