Samsung seeks Hong Kong arbitration after Microsoft lawsuit

NEW YORK (Reuters) - Samsung Electronics has initiated an arbitration proceeding in Hong Kong against Microsoft amid ongoing U.S. litigation over smartphone patent royalties.

The arbitration was disclosed in a court filing on Tuesday as part of a federal lawsuit Microsoft filed in August in New York accusing Samsung of refusing to make royalty payments to Microsoft after the software company announced its intention to acquire Nokia's handset business.

Samsung said it filed the request for arbitration with the Hong Kong office of the International Court of Arbitration of the International Chamber of Commerce. The filing did not indicate why the arbitration is taking place in Hong Kong.

Microsoft has successfully argued that Google Inc's Android mobile system uses some of its technology, and as a result most hardware makers, including Samsung, have agreed to pay patent royalties on Android handsets.

Samsung made royalty payments on time to Microsoft during the first fiscal year after they signed their 2011 agreement, the lawsuit said.

But after Microsoft announced the Nokia deal in September 2013, Samsung initially refused to make another payment, arguing the purchase breached its licensing agreement with Microsoft. Samsung eventually paid late without adding interest, Microsoft said.