After more than six years of disputes and battles between Immersion and Microsoft, the companies are waving white flags. After suing Microsoft for patent infringement on Xbox controller technology and winning, and then suing again for breach of a confidentiality agreement, Immersion will now pay Microsoft $20.75 million of the $26 million it received in a previous settlement.
The resolution gives Microsoft the one-time payment and makes Immersion part of Microsoft’s Partner Program, according to Immersion. “We are pleased to resolve our outstanding dispute with Microsoft and to put this litigation behind us,” said Client Richardson, Immersion president and CEO.
In February 2002 Immersion, the developer and licensor of haptic feedback technology, filed a patent-infringement lawsuit against Microsoft and Sony in U.S. District Court in California. Immersion said Microsoft and Sony’s use of haptic technology in the Microsoft Xbox and Sony PlayStation systems and controllers infringed on its TouchSense technology.
Haptic technology gives users touch sensations from a game controller. Immersion has been focused on haptic-based products since 1993, according to Immersion, and held more than 150 patents worldwide as of 2002. Today, the company has more than 400 filed and pending patents.
Bob O’Malley, the then-chief executive of Immersion, said Immersion had exhausted its attempts to settle infringement issues with Microsoft before filing suit to protect its intellectual property.
Microsoft agreed to settle and paid $35 million to Immersion ($26 million of which was settlement costs) in return for licensing rights and equity.
The two companies also agreed that in the event that Immersion settled with Sony, it would pay Microsoft a minimum of $15 million for any amount received from Sony up to $100 million, plus 25 percent of any amount over $100 million up to $150 million.
Four years later, Sony settled its patent-infringement lawsuit with Immersion after…