Microsoft has reached a tentative agreement to settle a patent-infringement, intellectual property theft, and antitrust lawsuit that Burst.com filed against the software giant. Under terms of the preliminary "agreement in principle," which Microsoft announced Friday, the company will pay Burst.com $60 million and will receive nonexclusive access to Burst.com's patent portfolio.
"While we were confident of prevailing in this lawsuit, we have been open from the beginning to finding a reasonable way to resolve this case," Tom Burt, Microsoft corporate vice president and deputy general counsel, said. "Securing a license to the Burst.com patent portfolio through this settlement allows us to focus on the continued development and deployment of Windows Media technologies to deliver the ultimate media experience to our partners and customers." Burst.com noted that the settlement validates its claims and proves that its work was both pioneering and innovative.
Burst.com sued Microsoft in June 2002, alleging that Microsoft had courted the company in a bid to purchase its then-new audio- and video-streaming technology. After 2 years of working closely with Burst.com, however, Microsoft suddenly broke off the relationship and shipped a suspiciously similar technology as part of Windows Media 9 Series. Burst.com says that Microsoft stole its streaming technology and then systematically destroyed related and damaging inhouse documentation to hide that fact.
Is that claim true? We might never know whether Microsoft actually stole Burst.com's digital media technologies. But this week's settlement, although in keeping with Microsoft's recent trend of settling outstanding litigation, is sure to harm the company's reputation. And the Burst.com case isn't the only Microsoft case that deals with digital media: The RealNetworks lawsuit against Microsoft is still outstanding.