Microsoft, others protest Nortel patent auction rules

Microsoft (NASDAQ:MSFT), Nokia (NYSE:NOK) and other technology heavyweights objected to the proposed auction terms for Nortel Networks' patent portfolio, which will officially go up for auction June 20. 

Microsoft, which said in a bankruptcy court filing Monday that it holds worldwide, perpetual, royalty-free access to Nortel's patents via a cross-licensing deal the companies inked in 2006, and that any prior agreements should be transferred to the new owner of the 6,000 patents in the portfolio. Monday was the deadline for bids to be submitted.

In addition to Microsoft and Nokia, Hewlett-Packard and Motorola Mobility (NYSE:MMI) also lodged objections to the auction rules. HP made a similar claim to Microsoft's about existing agreements. Motorola said it wants language in the rules that will allow it to assert legal arguments in any lawsuit brought by the eventual owner of the patent portfolio. Nokia wants the terms to ensure that the eventual buyer makes any industry-standard patents available at fair, reasonable and non-discriminatory terms.

Nortel is required to name the starting bid at least one day before the start of the auction. Google (NASDAQ:GOOG) made the opening "stalking horse" bid of $900 million for the patents in April. Reports have indicated in recent months that Ericsson (NASDAQ:ERIC) and Research In Motion (NASDAQ:RIMM) may bid for the patents. RPX Corp., a patent-buying firm, has confirmed it is interested in the portfolio, which is the last key remaining asset Nortel holds.

Nortel filed for bankruptcy protection in January 2009 and then sold itself in pieces, many of which have gone to Ericsson.

For more:
- see this Bloomberg article
- see this Reuters article
- see this WSJ article (subb. req.)

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