Microsoft Word Banned In U.S. By Texas Court

Microsoft was ordered to cease sales and support of Microsoft Word after a U.S. District Court judge in Texas ruled that the company violated an XML-related patent held by small Canada-based technology company i4i. In addition, the ruling also leveled a multimillion dollar fine against Microsoft. East Texas has been the setting for a variety of patent-infringement lawsuits against IT giants such as Microsoft, Apple and Sony, with smaller IT firms often winning huge judgments or settling out of court.

A U.S. District Court in Texas has banned the sale and support of Microsoft Word in the United States, after a judge ruled that Microsoft had violated patents held by Canada-based technology company i4i.

According to the permanent injunction filed on Aug. 11, Microsoft is banned from "selling, offering to sell, and/or importing in or into the United States any Infringing and Future Word Products that have the capability of opening a .XML, .DOCX or .DOCM file ('an XML file') containing custom XML."

The ruling extends to "Microsoft Word 2003, Microsoft Word 2007, and Microsoft Word products not more than colorably [sic] different." It also bans Microsoft from providing instruction or assistance to anyone using those applications.

"We are disappointed by the court's ruling," Kevin Kutz, a Microsoft spokesperson, said in a statement. "We believe the evidence clearly demonstrated that we do not infringe and that the i4i patent is invalid. We will appeal the verdict and the related injunction."

In May, jurors also ruled that Microsoft had infringed on U.S. Patent 5787499, issued to i4i in 1998, and leveled a $200 million verdict against the company. That original patent dealt with document and architecture content that relies on the XML custom formatting function. Law firm McKool Smith, which has represented i4i in the case, argued that a series of Microsoft e-mails showed that Redmond was aware of the patent.

The new ruling adds another $40 million to that previous total for "willful infringement," as well as $37 million in prejudgment interest and assorted other damages, for a total approaching $300 million; the court, headed by Judge Leonard Davis of the U.S. District Court for the Eastern District of Texas, Tyler Division, also stated that Microsoft would have 60 days to comply with the injunction.

But Microsoft may also have an ace up its sleeve. On Aug. 4, the U.S. Patent and Trademark Office issued the company Patent 7571169, which describes a "word-processing document stored in a single XML file that may be manipulated by applications that understand XML." If the technology is integrated into Microsoft Word and similar programs, it could undermine any infringement case stemming from another company's patent.

Microsoft has vigorously appealed similar cases in the past. The company is already embroiled in patent-infringement litigation with TomTom, which filed a suit in March alleging that Microsoft's Streets and Trips program violates four TomTom patents - little more than a month after Microsoft had filed its own suit against the navigation-IT company for patent infringement.

The Texas court system has been a favorite for small companies seeking to file patent lawsuits against IT giants: In 2007, some 409 cases dealing with copyright, patent or trademark claims were submitted in Eastern Texas U.S. District Court, a particularly high number when you consider that 768 such cases were submitted that year in all of New York state. 

Given that those IT giants have a history of either losing those Texas cases, or else settling out of court, many of the lawsuits feature small companies thinking very big: In July, a tiny IT outfit named Tsera filed a lawsuit against no fewer than 23 tech entities, including Microsoft and Apple, over a touch-screen patent. In 2006, Anascape sued Microsoft and Nintendo for allegedly violating its patents over game controllers, winning a $21 million judgment in the process.