RealNetworks Loses Arbitration Against VeriSign; May Have To Pay ‘Material’ Damages

RealNetworks

RealNetworks (NSDQ: RNWK) has lost an arbitration hearing against VeriSign (NSDQ: VRSN) related to a mobile partnership that the companies were involved with, according to an SEC filing that just came out from Real. The judgment came down in May and there was a further ruling on it under which VeriSign could claim monetary compensation, and “the Company could ultimately be required to pay damages to VeriSign in an amount that may be material to its financial condition and results of operations,” RealNetworks said in the filing. The amount hasn’t been decided by the arbitration panel but a hearing to that effect is scheduled on July 13 in Seattle, the company said. Real intends to pursue other options on this dispute as well. But it continues Real’s myriad legals fights, somewhat dispropotional to its current size and sphere of influence in the industry, as detailed well by this NYT story from two weeks ago.

Real and VeriSign had an agreement going back to 2001, where Real’s mobile messaging service, branded Metcalf, routes and delivers SMS (and e-mail and MMS) messages between wireless carriers within the U.S. and internationally; this was done in partnership with VeriSign. But VeriSign has been trying to sell off its messaging business, as it decided to focus on its core of internet infrastructure services.

The dispute started when Real first filed in June last year, to “seek resolution of disputes regarding the proper interpretation of an Alliance Agreement entered into between the parties dating back to 2001,” the filing said. VeriSign filed various counterclaims against Real including claims that “we breached the Alliance Agreement and tortuously interfered with VeriSign

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