VirnetX Files Patent Suit Against Microsoft Over Skype

VirnetX Holding Corp. (VHC) which won a $200 million settlement from Microsoft Corp. (MSFT) over patents related to private networks in 2010, filed a new lawsuit today claiming it’s entitled to more money.

VirnetX said Microsoft’s Skype unit, which allows instant messaging and Internet calling, is infringing six patents. Skype, which Microsoft bought in October 2011 for $8.5 billion, wasn’t part of that earlier deal, Zephyr Cove, Nevada-based VirnetX said in a statement today.

“Although Microsoft previously signed a patent license with VirnetX, we believe they are infringing our patents in ways that are outside the scope of the original license,” Kendall Larsen, the company’s chief executive officer, said in the statement. “We look forward to quickly resolving this matter.”

The complaint was filed in federal court in Tyler, Texas, where VirnetX has had mixed luck. One jury in November awarded VirnetX $368 million in a case against Apple Inc. (AAPL) over some of the same patents, while a different jury in March decided that Cisco Systems Inc. (CSCO) didn’t infringe the patents.

Redmond, Washington-based Microsoft and VirnetX reached the earlier settlement after Microsoft lost a jury verdict against VirnetX.

“Every successful technology company sees patent suits from time to time,” said David Cuddy, a Microsoft spokesman. “We’re confident in our handling of intellectual property and look forward to addressing these claims.”

Patent Licensing

VirnetX, which relies on patent licensing for its income, reported $412,000 in revenue last year. The company, whose shares rise and fall with its litigation, rose 74 cents or 3.9 percent, to $19.55 in New York trading. Its shares are down 33 percent this year.

Microsoft, the world’s largest software maker, reported $73.7 billion in sales in the last fiscal year. Microsoft rose 3.6 percent to $30.83. Its stock is up 15 percent this year.

The new case is VirnetX Inc. v. Microsoft Corp., 13-351, U.S. District Court for the Eastern District of Texas (Tyler).

To contact the reporters on this story: Susan Decker in Washington at sdecker1@bloomberg.net; Beth Mellor in New York at bmellor@bloomberg.net

To contact the editors responsible for this story: Bernard Kohn at bkohn2@bloomberg.net; Joanna Ossinger at jossinger@bloomberg.net

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