MPEG LA, a group of patent holders governing some media compression standards, is suing Apex Digital, claiming the company is selling DVD players without paying proper licensing fees. MPEG LA said it filed suit in federal court in Colorado, accusing Apex of violating its contract and demanding royalties for products that contain its MPEG-2 compression technology. MPEG LA also is seeking an injunction prohibiting Apex from selling the players until it pays the fees.
MPEG 2, which condenses large digital files into smaller ones, allows DVDs to play back on machines. Because it contains patented technology, the owners of the intellectual property require companies to pay licensing fees if they want to use it. "Apex must be held to its contractual obligations," MPEG LA CEO Baryn Futa said in a statement. "It must either compete fairly or stop using the technology." Apex did not immediately respond to requests for comment.