Online Chat Company Files $90 Million Xbox Live Lawsuit

By Evan Mix

Published on March 16, 2009

Microsoft, Inc., maker of the popular Xbox video game system, is being sued for $90 million by PalTalk Holdings, an online chat company. The suit claims that Microsoft's bestselling Halo game and the Xbox Live online multiplayer system infringe on two patents owned by PalTalk.

Lawyers for PalTalk have argued that their patents, purchased from developer MPath Interactive, Inc., are instrumental to the success of Microsoft's multiplayer chat system. The computer giant met with MPath to discuss their technology while exploring options for online in-game chat during the development of the Xbox Live platform.

Microsoft is disputing the claim. According to Microsoft lawyer David Pritikin, PalTalk bought the patents from MPath Interactive for less than $200,000. Additionally, Microsoft claims that though it met with MPath representatives, the company's technology proved poorly adapted to its needs, and Microsoft ultimately chose a more appropriate technology developed by a different company. Microsoft lawyers further argued that even should the jury side with PalTalk, the company's patents are worth only a fraction of the $90 million figure named in the suit.

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1

My xobx live subscription expired on 2/2009.The credit card that I used for auto renewal expired on 1/2009, and per their licence agreement if they can't charge for the next year they will suspend and or cancel my service.So I figured if I can't afford it they will cancel it.That was ok with me. Recently I got a job, so I thought I could reactivate my account,But No. I was told that I was in violation for not updating my information.They left my account open until 4/2009 then suspended it.I was told when reactivating my account that I owed for 2 months of service and I had to purchase a 12 month and only get service for 10 months or I will be sent to collections.I paid it so it wouldn't go any futher than that. My question is how many people have they done this to.

greg, over 2 years ago

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