Microsoft objects to Nortel patent sale terms

TORONTO Mon Jun 13, 2011 7:18pm EDT

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TORONTO (Reuters) - Google should not be able to buy thousands of patents belonging to bankrupt Nortel Networks under current sale terms, Microsoft said on Monday, the deadline for bids in an closely watched auction.

Microsoft, which claims a "worldwide, perpetual, royalty-free license to all of Nortel's patents" following a 2006 deal, said in a filing with a Delaware bankruptcy court that existing agreements should be transferred to any new owner of the intellectual property, which spans many fields.

Google has bid $900 million to buy more than 6,000 patents and patents applications belonging to Nortel, a once mighty Canadian network equipment maker that filed for bankruptcy protection in January 2009.

Under the terms of that sale agreement, which will likely face competing bids from many of the world's largest tech companies, Google would be given the right to terminate existing agreements.

Microsoft believes all such agreements "must remain enforceable against the purchasers of the transferred patents," whether it ends up being Google or another company, it said in the filing.

Computer maker Hewlett-Packard and handset makers Nokia and Motorola Mobility, among others, also filed objections to the terms of the sale.

The auction -- for patents covering wireless, data and optical networking, voice, Internet, semiconductors and other technologies -- is due to take place later this month.

(Reporting by Alastair Sharp; Editing by Steve Orlofsky)

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