Salesforce Countersues Microsoft for Patent Infringement
Salesforce.com is targeting Microsoft in a patent-infringement suit. Salesforce's legal maneuver comes in response to the software giant's intellectual-property suit filed against the customer relationship management (CRM) vendor in May.
Salesforce filed suit against Microsoft on Thursday in the U.S. District Court for the District of Delaware. Salesforce alleges that several Microsoft products, including the popular .NET platform and SharePoint collaboration software, trespass on its patents. In fact, Salesforce is asserting that Microsoft willfully infringed on its intellectual property.
"This is a normal defense until someone finds a compelling reason to come to the table and work it all out. You would think Microsoft would have the deeper patent portfolio because they've been around longer and have been doing this longer," said Rob Enderle, principal analyst at the Enderle Group. "Typically in a battle like this, the larger, longer-existing company and better-funded company wins. It's that kind of a fight."
Microsoft's First Missive
Microsoft filed a patent-infringement action against Salesforce in the U.S. District Court for the Western District of Washington in May. Microsoft claims Salesforce's CRM product trespasses on nine of its patents.
The patents in question work to make CRM software more efficient. But by targeting Salesforce with the suit, it appears Microsoft is going for the jugular. CRM is at the heart of Salesforce's business model.
Microsoft is seeking a court order that would prohibit Salesforce from offering features in its software suite that infringe on its patents. If Microsoft succeeds, it could damage the core of Salesforce's business.
Is Microsoft a Patent Troll?
It's rare for Microsoft to file a patent-infringement suit. Microsoft has only filed four such suits in its history, though the company has been the defendant in scores of suits. It's possible that Microsoft feels threatened by Salesforce's software-as-a-service model. And it's clear that Salesforce feels threatened by Microsoft. Salesforce CEO Marc Benioff called Microsoft an "alley thug" and a "patent troll" in a recent earnings call.
Salesforce has on its side David Boise. He is perhaps best known as the prosecuting attorney for the U.S. government's antitrust case against Microsoft. This is the same attorney who is representing Oracle in its IP suit against SAP. But if Salesforce loses the battle, it could have to pay licensing fees to Microsoft.
"This is now an intellectual-property game between an awful lot of the companies. Unfortunately, that's how the game is played. We are running rampant with litigation in the technology industry," Enderle said. "We go through phases where everybody sues everybody, and we're certainly seeing that between HTC and Apple and Microsoft and Salesforce and many others. We are in that litigation phase that makes law firms so incredibly happy."