Original URL: http://www.theregister.co.uk/2004/09/13/sendo_ms_settle/

Microsoft settles Sendo 'tech theft' lawsuit

Both sides 'happy'

By Tony Smith

Posted in Financial News, 13th September 2004 09:37 GMT

UK mobile phone maker and erstwhile Microsoft partner Sendo today said they had settled their long-running legal dispute.

The terms and conditions of the out-of-court deal were not disclosed, but it is known that Microsoft will hand back its four per cent stake in the privately held Sendo.

Sendo was Microsoft's original smart phone partner, but the two fell out in 2002 when the manufacturer accused the software giant of nicking its technology and customers.

Due to ship in November 2002, Sendo's Z100 handset, based on Microsoft Windows for Smartphones 2002 OS, was canned weeks before its launch. The move was accompanied by Sendo's revelation that it had opted to go with the Symbian OS instead.

Sendo's Sendo X Series 60 handset finally shipped earlier this summer.

Back in late November 2002, Sendo said it had dropped Microsoft after conducting a smart phone strategy review, but, tellingly, less than two months later it initiated legal proceedings against its former OS partner.

"If we had a choice we would have launched the Z100 - we have customers, we were days away from shipping - but we had no other course of action," said Marijke van Hooren, Sendo's director of communications, at the time.

Sendo accused Microsoft of maintaining a "secret plan... to plunder the small company of its proprietary information, technical expertise, market knowledge, customers and prospective customers... Microsoft gained Sendo's trust and confidence through false promises that Sendo would be its 'go-to-market-partner'."

"Microsoft used Sendo's knowledge and expertise to its benefit to gain direct entry into the burgeoning next-generation mobile phone market and then, after driving Sendo to the brink of bankruptcy, cut it out of the picture," the company's original US court filing alleged.

"Microsoft provided Sendo's proprietary hardware expertise and trade secrets to low-cost original equipment manufacturers (OEMs) who would not otherwise have had the expertise to manufacture handsets that would use (Microsoft software) and used Sendo's carrier-customer relationships to establish its own contractual relationships," the lawsuit said.

Sendo later sued mobile phone network Orange, claiming the network's Microsoft-based SPV handset violated its intellectual property, but the two companies soon settled out of court.

Sendo today said it was "extremely pleased" with the terms of the settlement of a legal action that is believed to have cost it a tidy sum. Microsoft gets off with a denial of any and all liability.

Microsoft, too, said it was "pleased with this resolution", Reuters reports. ®

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