After merger approach fails Sprint turns to infringement suit against cable giant Charter 08 Dec 17
Sprint, the US’s fourth largest mobile company, has launched a patent infringement lawsuit against Charter alleging that the cable TV giant infringes on 11 patents relating to voice over packet (VoP) technology.
The case was filed in Delaware district court earlier this month and marks the latest attempt by Sprint, which is owned by Japanese tech giant Softbank, to monetise its patent portfolio. As well as the suit against Charter, Sprint also filed a case using the same patents against another cable business, Mediacom Communications.
Over the last decade, Sprint has notched up infringement victories on the same technology from Vonage, which resulted in an $80 million licence agreement, and Time Warner Cable, from which it secured a $139.8 million damages award. In October this year the company also announced a settlement with Comcast in which it received $250 million in an agreement that ended six years of litigation.
What gives the case against Charter an extra edge is that earlier this year the two reportedly considered merging following an approach from Sprint. The mobile business has been casting around for a team-up for some time as it looks for growth in the highly competitive US market. But attempts to do a deal with T-Mobile, the country’s third largest mobile business (measured by subscriber base), have failed with the most recent attempts coming to an end in November.
“We understand why a deal is attractive to Softbank, but Charter has no interest in acquiring Sprint,” a Charter spokesperson told the Wall Street Journal. The merger approach came after Sprint discussed a number of possible deals with Charter and Comcast, including letting the pair use its network for their own mobile service. Sprint’s patent suit suggests that the prospect of any sort of agreement with Charter is now off the radar, although the litigation could provide some leverage should the two companies revisit a deal of some sort.
The other interesting point to note about Sprint’s recent litigation track record is that while Softbank’s chairman, Masayoshi Son, has been busy courting the tech industry to participate in a tech-focused Vision Fund, his main American investment has not been afraid to assert its patent rights (an activity that does not always win friends in Silicon Valley). That suggests that the IP group at investment giant Fortress, a more recent Softbank acquisition, may see little change in its enforcement activities.
The Fortress team is currently in the process of monetising assets formerly owned by the NPEs Marathon and Inventergy, and has brought suits against Apple, HTC and, most recently, ZTE. It has also hired the former co-chair of Perkins Coie global IP practice Jon James, to head its litigation efforts in a clear sign that it is doubling down on its enforcement activities. How Softbank views those assertions may ultimately depend on who Fortress pursues in its infringement suits, but Sprint’s litigation history shows that the Japanese company is fully prepared for its suite of US businesses to turn to the courts in order to monetise their IP.
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