EU approves Sony-Philips acquisition of InterTrust

Sony Corp. of America and Koninklijke Philips Electronics NV have won regulatory approval from the European Commission to acquire InterTrust Technologies Corp., which holds numerous patents in the area of digital rights management (DRM).

The deal, valued at US$453 million, raises no serious competition concerns based on the companies’ position in the global markets for DRM-related intellectual property rights and existing competition in these markets, the Commission said in a statement issued Monday. The Commission referred to DRM markets as “nascent,” arguing that the technology is still developing.

DRM technology is implemented in software and most often used to protect digital content, such as music and video clips, from unauthorized copying. InterTrust’s technology can also be used by corporations for digital policy management.

The U.S. subsidiary of Tokyo-based Sony Corp. and Philips in Amsterdam will acquire InterTrust Technologies through Fidelio Acquisition Company LLC., a jointly owned company.

InterTrust, located in Santa Clara, California, holds 26 U.S. patents for DRM technologies, with approximately 85 patent applications pending worldwide, according to Sony, which agreed to license some of the patents earlier this year.

The company sued Microsoft Corp. in April 2001 for alleged patent infringement, and in June of this year expanded its allegations to involve 11 patents, 144 claims and more than 190 infringement scenarios InterTrust believes Microsoft was responsible for.

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