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eBay and Skype Founders Reach a Deal

eBay Gives Up a Little to Gain A Lot

1 min read

eBay and Skype Founders Reach a Deal

Last week, the original founders of Skype came to a mutually agreeable solution with eBay to their disagreement about who owned what patents to the technology underlying Skype. As you may recall, eBay decided to sell Skype to a group of investors for $1.9 billion in cash and a note for a further $125 million, with eBay still keeping a 35% share of the "new" company.

Skype founders Janus Friis and Niklas Zennstrom then filed a copyright suit against eBay and the investors that plan to buy Skype from it for $2 billion. They also alleged that Skype should not possess, use or modify certain software source code and that, by doing so, and by disclosing such code in certain U.S. patent cases pursuant to orders from U.S. courts, Skype had breached their license agreement.

In the settlement reached last week, Zennstrom and Friis and their company Joltid Ltd. will take a 14 percent stake in the "new" Skype alongside a group led by reconstituted private-equity group. eBay's share will now drop to 30% of the "new" Skype.

All lawsuits have been dismissed, much to the disappointment of the lawyers involved no doubt. The deal will be finalized before the end of the year.

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