Microsoft has filed legal action against Samsung today in New York on the basis that Samsung has stopped paying to license intellectual property from Microsoft for its Android devices.
Since 2011 Microsoft and Samsung have held a cross-licensing agreement that has shared the rights of intellectual property between the two companies, with fees associated to using that IP on Android devices. But according to Microsoft's legal team, Samsung stopped making payments in late 2013 for the technology. Corporate Vice President & Deputy General Counsel for Microsoft, David Howard, had this to say:
"After spending months trying to resolve our disagreement, Samsung has made clear in a series of letters and discussions that we have a fundamental disagreement as to the meaning of our contract."
Samsung's argument in all this, according to Howard, is that the cross-licensing agreement no longer applies since Microsoft announced that it was going to acquire Nokia. Microsoft claims, of course, that Samsung's decision to stop paying licensing fees, regardless of the reason, is in breach of their contract with Microsoft.
Howard notes that Samsung has more incentive now to not pay Microsoft on a per-device basis, pointing out the fact that shipments of Samsung Android devices have quadrupled since the two companies first agreed to licensing terms.
The legal filing itself has not yet been made public, and we really only have one side of the story here with no official statement from Samsung. You have to think that if Samsung had any reason at all to think it was no longer required to pay licensing fees for each and every Android phone it sells, it would stop doing so — its responsibility to shareholders is to make as much money as possible, after all.
This will not end simply, we're sure.
Source: Microsoft Blog