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In Court: Microsoft Corporation (MSFT) Vs. Samsung Electronics & Apple Inc. (AAPL) Vs. GT Advanced Technologies Inc (GTAT)

Litigations are nothing new to companies like Apple Inc. (NASDAQ:AAPL) and Microsoft Corporation (NASDAQ:MSFT) as both these tech giants have faced numerous legal issues in the past. Microsoft Corporation (NASDAQ:MSFT) faces a litigation from 2011 agreement between Microsoft and Samsung Electronics. GT Advanced Technologies Inc recently filed a bankruptcy, and US bankruptcy judge might free GTAT from its agreement with Apple Inc. (NASDAQ:AAPL), thereby giving complete control of the Arizona sapphire production facility to GTAT. A ‘Bloomberg’ article discusses about both the stories.

judge- law lawyer court supreme court

Samsung Electronics and Microsoft Corporation (NASDAQ:MSFT) had a patent-licensing agreement signed in 2011, according to which Samsung had to pay a royalty for using Microsoft’s patents in its smartphones. But in April 2014, Microsoft Corporation (NASDAQ:MSFT) acquired the Finnish Phone maker, Nokia. Samsung refused to pay the royalty fees of $1 billion for 2013, since it considers Microsoft as a competitor now, after $9.4 billion acquisition of Nokia.

On October 30, Samsung filed a claim stating that Microsoft Corporation (NASDAQ:MSFT) has triggered the termination right of the agreement, when they acquired Samsung’s direct competitor.

“(Samsung) has been put in the untenable position of being asked to provide, […] highly confidential and competitively sensitive (information),” Samsung was quoted as Alleging.

Samsung also added that if the agreement is not terminated then Microsoft Corporation (NASDAQ:MSFT) might be subjected to antitrust claims. On the other hand, Microsoft claims that Samsung has breached the agreement by not paying royalty for sharing patents. Microsoft also claims that Samsung is just using Nokia acquisition as an excuse to breach the agreement.

GT Advanced Technologies Inc had a multi-year deal signed with Apple Inc. (NASDAQ:AAPL). According to the deal, Apple Inc. (NASDAQ:AAPL) gave $578 million prepayment loan in order to build the sapphire making furnaces in Arizona. In return, GT Advanced Technologies Inc would provide the needed Sapphire for Apple Inc. (NASDAQ:AAPL)’s products.

GTAT failed to keep the executive description about filed bankruptcy a secret, thereby is at risk not to arrive at a settlement with Apple Inc. (NASDAQ:AAPL). GTAT and Apple agreed to keep the terms of agreement and the executive statement sealed. But US Bankruptcy court Judge, Henry Boroff expressed his intent to unseal it, and agreed to just have some pricing information confidential.

A statement was filed by GTAT COO Daniel Squiller on October 28. Judge Boroff mentioned that he will go through Squiller’s statements and other related documents and issue unsealing order this week. The judge ruling might probably free GTAT from agreement with Apple and give control of more 2000 sapphire making furnaces at Arizona and sapphire-manufacturing patents to GTAT. The ruling might also let GTAT regain ownership of the plant and give it the sales right of sapphire. Apple Inc. (NASDAQ:AAPL) hasn’t responded to it yet.

Disclosure: None

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