In response to DOJ, Antitrust Division, concerns, a Microsoft-led joint venture has agreed to change its deal to purchase over 800 patents from Novell as part of its sale to Attachmate. Under the revised sale agreement, Microsoft and EMC will not be allowed to hold certain patents, and all of the patents will be covered by both a key license for the Linux system and a broadly used open source licensing agreement. In approving the deal, U.S. Department of Justice antitrust officials said they would continue to investigate the competitive effects of the distribution of patents.
The joint venture, CPTN Holdings LLC, was created by Microsoft Corp., Apple Inc., Oracle Corp. and EMC Corp. to buy 882 patents and patent applications from Novell as a key part of the company’s $2.2 billion sale to Attachmate Corp. Antitrust regulators, however, concluded that the proposal could undermine the competitiveness of open source software operating systems such as those based on Novell’s Linux.
As a result, Microsoft has agreed to sell all of the Novell patents it would have acquired through the joint venture back to Attachmate. The company will, however, still receive a license to use all of those patents, as well as the patents sold to its fellow joint venture members and to any patents that Novell ends up keeping.
EMC will also not acquire 33 Novell patents and applications that deal with virtualization software, according to the regulator.
All of the patents covered by the deal will be sold subject to the Open Invention Network License, which is designed to share rights to patents used in the Linux system, and the joint venture will not be allowed to limit which patents are available under that license. Neither CPTN nor its owners will try to encourage Novell or Attachmate to change which patents they include in the OIN license.
According to the DOJ, the patents are also being sold subject to the second version of the GNU General Public License. While the regulator agreed to let the transaction go forward with the modifications, it said it would continue to investigate the distribution of Novell’s patents to the four technology companies.
“The parties’ actions address the immediate competitive concerns resulting from the transfer of Novell’s patents,” said Sharis A. Pozen, deputy assistant attorney general for the Antitrust Division. “Although we recognize that the various changes to the agreement recently made by the parties are helpful, the department will continue to investigate the distribution of patents to ensure continued competition.”
The joint venture — which will dissolve after three months and grant all four companies licenses to all the patents — also received antitrust clearance from Germany’s Federal Cartel Office on Wednesday.