Immersion Corp. agrees to shell out $20.75 million to Microsoft in settlement refund. Image: Immersion/BradIpo/Flickr.
American software giant Microsoft Corp. has this week taken receipt of some $20.75 million USD in a settlement to a longstanding legal struggle with innovative haptics technology company Immersion Corp.
Immersion, which owns a patented force-feedback vibration system utilised by the likes of Microsoft and Sony in their videogame hardware, initially sued Microsoft in 2002 for infringing on its rumble technology. In 2003, Redmond-based Microsoft settled with Immersion by agreeing to pay it the tidy sum of $26 million USD.
However, conditions related to the settlement subsequently opened a fresh courtroom battle between the two companies after Immersion sued Sony Corp. for also infringing upon its vibration technology.
Specifically, Microsoft’s settlement was conditional insofar as an included a “Sublicense Agreement,” which outlined that Immersion would return a considerable chunk of the $26 million USD payout depending on the size of any settlement deal it reached at a later date with Sony.
Looked at from another perspective -- based on Immersion’s comparatively modest size beside the likes of Microsoft and Sony -- Microsoft’s initial settlement served as funding for Immersion as it then moved to challenge the legality of Sony’s Dual Shock rumble controller.
The conditional agreement was built on the notion that Microsoft would recoup its lost money when and if Immersion won its courtroom battle with Microsoft’s biggest videogame rival.
At the close of the Immersion vs. Sony clash, which was settled in March of 2007, Sony agreed to pay Immersion $22.5 million USD along with $100 million USD in related costs, royalties and patent fees, which Microsoft promptly claimed it was entitled to a share of through its payback clause. Immersion refuted that claim.
As a result, Microsoft slapped Immersion with a lawsuit in June of 2007, accusing the technology company of attempting to sidestep the agreed refund by pretending Sony’s payout was not actually a settlement.
Immersion has this week buckled and agreed to provide Microsoft with a one-time payment of $20.75 million USD.
“We are gratified that we have successfully resolved our claims under the 2003 settlement we negotiated with Immersion, which provided benefits to both companies and specific rights to Microsoft,” commented Steve Aeschbacher, Microsoft’s associate general counsel, in a statement.
Beyond the fulfilment of Immersion’s refund obligation, the two companies have also confirmed that Immersion is to become an official Microsoft partner in order to integrate its technologies into Microsoft’s next PC operating system, which is presently known as Windows 7 and due for release in 2010.
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