US financial reporting software vendor Timeline has responded to the breach of contract lawsuit filed against it by Microsoft Corp. on Monday.
In its suit filed in the Superior Court of the State of Washington in King County, Microsoft alleges that Timeline has breached the patent licensing agreement signed between the two companies last month.
Under the terms of that agreement, Microsoft gained access to Timeline's Data Retrieval patented technology which relates to a method of data access, transformation and preparation for financial reporting applications. The patented technology can also be used in the automatic creation of data marts, smaller versions of data warehouses.
Microsoft contends that under the terms of its licensing agreement with Timeline, Microsoft's customers, ISVs (independent software vendors) and solution providers are entitled to sublicense Timeline's patented technology free of charge to develop their own applications.
Yesterday, Timeline gave its own interpretation of the agreement with Microsoft.
"Timeline believes the license agreement clearly distinguishes between users of Microsoft products who may employ Timeline technology, and certain third party software developers to whom Microsoft may not sublicense," said Charles Osenbaugh, president and chief executive officer of Timeline in a statement issued late yesterday. He put a potential value on any sublicensing of his company's patent at tens of millions of U.S. dollars.
Osenbaugh had the following advice for developers. "I would simply suggest anyone relying on a sublicense from Microsoft seek the advice of their own counsel on the relevant language of the agreement," he said in the statement. "We are absolutely confident in our position. A license directly from Timeline is undoubtedly a more secure option for software developers."
The Timeline statement included two clauses from the agreement between the company and Microsoft relating to the disputed patent which it said supported its position.
Microsoft, in Redmond, Washington, can be reached at +1-425-882-8080 or via the Internet at http://www.microsoft.com/. Timeline, based in Bellevue, Washington, can be reached at +1-425-822-3140 or via the Internet at http://www.timeline.com/.