Microsoft Loses Intellectual Property Battle in Chinese Court

"We believe our license agreements with Zhongyi cover in full our use of their technology," a Microsoft spokesperson said in an e-mail to eWEEK. "We plan to appeal the decision for the copyright case."

Microsoft's opposite number in the case seems equally prepared to continue the fight into the appeals process.

"The case dragged on for a long time and the scale and impact of the case was very large," a spokesperson for Zhongyi Electronic told AFP, suggesting that the company would ask the court for "large" damage compensation.

Microsoft is involved in other intellectual property battles as well. Earlier in 2009, Canadian company i4i sued Microsoft for allegedly incorporating its code into Microsoft Word. The court originally ruled in favor of i4i, and ordered Microsoft to pay nearly $300 million in accumulated fines and pull all copies of Word from store shelves by mid-October; however, the U.S. Court of Appeals for the Federal Circuit later ruled on appeal that Microsoft could keep selling its word processing platform during the remainder of the case.

A comparatively minor tempest erupted the week of Nov. 9, when Microsoft took responsibility for a third-party developer lifting code from a CodePlex-hosted open-source project to build its free Windows 7 USB/DVD Download Tool.

"While we had contracted with a third party to create the tool, we share responsibility as we did not catch it as part of our code review process," Peter Galli, open-source community manager for Microsoft's Platform Strategy group, wrote on Microsoft-affiliated Website Port25 on Nov. 13. "We had furthermore conducted a review of other code provided through the Microsoft Store and this was the only incident of this sort we could find."

Microsoft promised to make the source code and the binaries for the tool available under the terms of General Public License v2, which governs the ImageMaster project from which the code originated.