Microsoft Sued After Phone Deal Goes Bad

Microsoft's lawyers may not get much of a holiday this year.

Sendo Holdings plc, once a Microsoft partner in the smart Web phone arena, has sued its former collaborator, claiming that Microsoft conspired to steal Sendo's trade secrets.

The lawsuit, filed this week in U.S. district court in Texarkana, Texas, outlines what Sendo calls a secret plan by Microsoft "to plunder its proprietary information, technical expertise, market knowledge, customers, and prospective customers."

The partnership has been unraveling for some time. In October, Microsoft said it was going with another manufacturer, Taiwanese High Tech Computer. Last month, Sendo said it was canceling its Z100 Smartphone, which relied on the Windows for Smartphone 2002 operating system, citing Microsoft's delay in sharing source code. Now, Sendo's suit says, some of its technology is appearing in High Tech Computer's Orange SPV Web-enabled mobile phone.

In the meantime, Sendo has signed a deal to get an operating system to power its products from Nokia and Symbian.