TomTom settlement leaves key questions unanswered

While reaction to Microsoft's settlement with TomTom was varied on Monday, there seemed to be a consensus that it will do little to settle the many questions related to whether Linux infringes on Microsoft's intellectual property.

Attorney James Gatto, the leader of the intellectual property section at Pillsbury Winthrop Shaw Pittman, said the quick settlement in the case may have as much to do with a pragmatic business decision by TomTom as it does with the legal merits of Microsoft's case. Complex litigation, such as the patent suit and countersuit in this case, could easily add up to $10 million to $15 million in costs, Gatto said.

"I don't think this answers any questions in terms of whether Microsoft's patents in any way cover Linux," Gatto said. Microsoft has long asserted that various implementations of Linux do infringe on its intellectual property and has struck a number of patent deals with companies that either distribute Linux or use it in their products.

The TomTom case, however, marked the first time that Microsoft had made those allegations in court papers.

Open-source pioneer Bruce Perens criticized the settlement, saying that it may instill fear in other companies that are using embedded Linux and thus have something of a chilling effect.

"What strikes me is the un-justice of it all," said Perens, who is the chief executive of open-source software development company Kiloboot. "Microsoft's patents (in the TomTom case) are not innovative, yet TomTom is forced to pay for the patents when a court would probably find them invalid. But rather than spend the money to prove the patents are invalid, because they probably can't afford to go to court and fight it, TomTom licenses the patents."

Gatto said that Microsoft's TomTom move doesn't necessarily mean the company is ready to go to war with Linux.

"Microsoft, over the last several years, has been much more aggressive about asserting its patents," he said. "It's not just about Linux. They have been doing it across the board."

Red Hat, one of the Linux companies that has been most vocal about not striking a deal with Microsoft, noted in a statement the many things left unanswered by the settlement.

"Without a judicial decision, the settlement does not demonstrate that the claims of Microsoft were valid," Red Hat said in a statement. "Patent litigation is a difficult process, and there are many reasons besides the merits of the case that a defendant such as TomTom might have chosen to settle in the present economic environment."

Gatto noted that, if anything, Microsoft has been trying to tread lightly around the Linux issue. While patent disputes among companies generally are of little interest outside those companies, Gatto said that Microsoft is aware that its moves vis a vis Linux impact the company's relationship with the open-source community as a whole.

"There are a lot of repercussions," Gatto said. "Microsoft has been somewhat tiptoeing around this."

As for what lessons open-source companies should take away from this, Gatto said that all businesses need to be aware of the intellectual property issues around their products.

"Patents are prevalent in every industry," Gatto said. "Software is no exception and open source is no exception. There is no greater or lesser need for attention to patents for open source. Every company these days needs to be vigilant with respect to intellectual property, both offensively and defensively."

A second issue raised by the settlement is whether, in fact, Microsoft and TomTom were indeed able to comply with the terms of the General Public License in crafting their deal. The two companies did not go into detail on the settlement, but noted it includes a covenant not to sue TomTom's customers--a tactic similar to the approach it took with Novell and other companies.

"As the terms of the settlement license have not, to our knowledge, been made public, it is not possible to comment on their compliance with open source requirements and principles," Red Hat said in its statement.

Update: Comments continue to come in.

Van Lindberg, an attorney at Haynes and Boone and author of "Intellectual Property and Open Source," said that "both companies backed down from the brink because they both had a lot to lose."

"Microsoft probably didn't want to test the FAT patents in court, and may have been worried about facing an expensive battle over the (Open Innovation Network) patent portfolio," Lindberg said in an e-mail interview. "TomTom was probably worried about a long and expensive patent battle about technology that was not central to their product."

He noted that Microsoft continues to try and structure deals in ways that conform with open-source contract terms.

,p> "Not too many years ago, Microsoft was publicly questioning whether Linux would be a viable competitor," he said. "Microsoft has obviously come to the conclusion that Linux--and the GPL--are market participants that need to be handled on their own terms."

Lindberg said that, to him, the most interesting element of the TomTom agreement was the company's decision to remove the FAT (File Allocation Table) file system from their product within two years. "That seems like a win for Microsoft, but in the long run it may end up reducing Microsoft's patent leverage, just as the GIF patent did for Unisys," Lindberg said, noting that Perens has already called for the removal of FAT from Linux devices.

The Software Freedom Law Center, meanwhile, sought to claim victory with the TomTom settlement.

"Today's settlement between Microsoft and TomTom shows the strength of our community's resistance to patent aggression by Microsoft," the group said in a statement. "TomTom avoids protracted expensive litigation and will continue to be the world leader in Linux-based navigation devices. It will innovate on its own and the community's behalf to prevent even invalid patents from being used to inhibit our community's ability to make software."

The group initially stated that the settlement agreement does not violate the terms of any open source license, but amended that statement later on Monday to say "On the basis of the information we have, we have no reason to believe that TomTom's settlement agreement with Microsoft violates the license on the kernel, Linux, or any other free software used in its products."

The organization added that it believes "the settlement neither implies that Microsoft patents are valid nor that TomTom's products were or are infringing."

CNET News' Dawn Kawamoto contributed to this report.