Video game publisher Activision Inc. has asked a federal court to declare that its popular “Guitar Hero” game does not violate a patent held by real-guitar maker Gibson Guitar Corp.

Gibson’s 1999 patent covers a virtual-reality device that included a headset with speakers and that simulated participating in a concert, according to a complaint filed on Tuesday by Santa Monica, Calif.-based Activision in U.S. District Court in Los Angeles.

Gibson is trying to get Activision to stop selling “Guitar Hero” until it gets a license under the patent, according to the complaint. But Activision says it doesn’t want or need a license under the patent.

“We disagree with the applicability of their patent and would like a legal determination on this,” George Rose, Activision’s general counsel, said in a statement Wednesday.

No one answered an after-hours call to Nashville, Tenn.-based Gibson.

The dispute arose in January, when Gibson attorneys sent Activision a letter accusing it of violating a patent titled “System and Method for Generating and Controlling a Simulated Musical Concert Experience,” according to the complaint.

A copy of the patent included in the lawsuit and dated Nov. 23, 1999, describes a device that lets a user “simulate participation in a concert by playing musical instrument and wearing a head-mounted 3-D display that includes stereo speakers.”

The device described in the patent also includes playback of audio and video of a prerecorded concert and a separate track of audio from the user’s instrument, according to the patent form.

“Guitar Hero” users play songs using a stringless, plastic guitar by following graphics displayed on a TV connected to a game console. The TV also displays animated musicians playing along.

All the versions of “Guitar Hero” have been a boon to Activision. The company reported last month a 90 percent increase in profit for the third quarter ended Dec. 31, in part due to strong sales of “Guitar Hero III: Legends of Rock.”

Shares of Activision fell 31 cents, or about 1 percent, to $26.82.

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Microsoft Corp (MSFT.O) cut the prices of its Xbox 360 video game console in Europe by up to 28 percent on Monday to try to spur sales in a key battleground in the fast-growing industry. The 80-euro decrease results in cuts of 18 percent to 28 percent across the three Xbox 360 models, bringing the cheapest Arcade version to 200 euros ($307) and the high-end Elite to 370 euros ($568). Prices reductions in Britain range from 20 pounds to 50 pounds.

“Xbox 360 is now mass market in Europe,” Chris Lewis, vice president of Microsoft’s interactive entertainment business in Europe, said in a statement.

The reductions come as Sony Corp’s (6758.T) PlayStation 3 appears set to capitalize on the company’s recent victory in the high-definition DVD battle and on a slew of highly anticipated new games hitting the market this year.

“The PS3 has gained some momentum recently,” Kaufman Bros analyst Todd Mitchell said, “and I think as you go into this summer before the fall, Microsoft has got to do what they can to shore up sales.”

This was the second price cut for the Xbox in Europe in less than a year. Last August, Microsoft shaved 7 percent off the euro price of its low-end model and 13 percent off the main Premium model.

“The tide is kind of turning against the Xbox 360, so Microsoft has to be as aggressive as possible,” Mitchell said.

The PlayStation brand has long dominated the European console market, although the PS3 has struggled to win fans due to its high price and lack of must-have games.

Last October, in an effort to kick-start sales, Sony introduced a cheaper PS3 model in Europe for 400 euros and cut prices on a high-end version to 500 euros.

Meanwhile, Nintendo Co Ltd (7974.OS) is winning customers with its Wii machine that sports unique motion-sensing controls and games that are easier to learn.

(Reporting by Scott Hillis; editing by John Wallace and Lisa Von Ahn)

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