Feds to Probe Apple, Microsoft, RIM's Nortel Patent Deal Over Alleged Misuse Against Competing Google Android Smartphones

The Nortel patent sell-off deal was approved on July 11. Microsoft is part of a consortium that purchased for $4.5 billion about 6,000 patents from the bankrupt Nortel (which, at one time, was a Microsoft strategic partner). Comprised of Microsoft, Apple, Ericsson, EMC, Sony and RIM, the consortium beat out Google for the bundle of […]

The Nortel patent sell-off deal was approved on July 11. Microsoft is part of a consortium that purchased for $4.5 billion about 6,000 patents from the bankrupt Nortel (which, at one time, was a Microsoft strategic partner).

Comprised of Microsoft, Apple, Ericsson, EMC, Sony and RIM, the consortium beat out Google for the bundle of Nortel telecommunications-focused patents. Apple contributed the lion's share ($2.6 billion) to the consortium's patent pool. Microsoft originally signaled it wasn't going to bid on the Nortel patents, as it had a comprehensive patent cross-licensing deal in place which officials said covered the patents that were on the block.

The Wall Street Journal reports that the Justice Department is trying to determine whether the purchase would unfairly hurt smartphone makers that use Google's Android operating system. The concern is that the Nortel patent sale could make Google an antitrust victim (picked up over 1,030 patents from IBM last week).

Microsoft is going to have to pay Alcatel-Lucent $70 million for a patent infringement claim dating back to 2003. On July 29, a U.S. District Court jury in San Diego issued its final damages ruling on the matter. The patent in question was for touch-screen technology for entering forms information. Before last week's ruling, Microsoft was going to have to pay over $500 million to Alcatel-Lucent (counting interest and additional patent-infringement damages).

Does this mean Alcatel-Lucent vs. Microsoft is finally over? Maybe not. Microsoft issued a statement from David Howard, Corporate Vice President and Deputy General Counsel, Litigation:

"This trial came about after the Federal Circuit ordered a new trial on damages, overturning an original judgment of over $500 million for the same patent. Today's verdict reflects a positive trend in the law of patent damages stemming from the Federal Circuit's earlier opinion in this and other cases. However, we continue to maintain that current law requires a genuine apportionment of damages when the infringement is directed to a small feature of a feature-rich product, and we are reviewing the verdict in that light and considering next steps."

Companies licensing the Android operating system have faced an increasing number of patent-infringement lawsuits in recent years, especially from companies such as Microsoft and Apple. Apple sued HTC and Samsung. We've also, reported (Samsung, Obkyo, HTC, Velocity, Itronix, Wistron ) about the increasing number of device makers entering patent-licensing agreements with Microsoft in the last year. According to reports, Microsoft is making more in these Android licensing deals ($15 per devices from Samsung, $5 per devices from HTC) than from licenses of its own Windows Phone.