Despite reports saying that Microsoft and the W3C have Eolas Technologies on the ropes in their patent battle over basic browser technology, Eolas sounded an upbeat note Thursday.
The companys lawyers on Thursday received an “office action” from the U.S. Patent and Trademark Office, and they say the notice may have only reset the clock on the IP (intellectual property) fight.
Chicago-based Eolas Inc. holds a license to the patent, No. 5,838,906, from the University of California at Berkeley. Last year, it won a $521 million jury verdict against Microsoft Corp. in its patent-infringement case. Microsoft has since appealed the verdict.
According to patent office spokeswoman Brigid Quinn, Eolas on Monday was mailed an “office action” on the re-examination of the disputed patent. A number of online reports said the patent office examiner decided to reject the 10 claims presented by Eolas.
But Eolas attorney Martin Lueck, of Minneapolis-based Robins, Kaplan, Miller & Ciresi LLP, said the examiner had accepted a number of Eolas arguments and had withdrawn his previous finding from February.
Lueck said the patent office examiner had issued a new action—based on yet another piece of “prior art”—to reject the patents claims. The prior-art piece was outside the examples offered by the W3C (World Wide Web Consortium), which brought the prior-art question to the attention of the patent office in November 2003.
Prior art is a legal term referring to whether an invention existed prior to the filing of a patent. But this “piece of art” was not addressed in the February action, he said, hence the reversal.
“Were back to square one,” Lueck said. Eolas responded to the February ruling in May by saying, “The university and Eolas will be responding to this office action. And we will show that this prior art doesnt make our claims invalid, either.”
The patent in question has a long and contentious history. Issued in 1998 to UC Berkeley, it covers the fundamental method for embedding and invoking interactive applications in all browsers.
?”> Since the patent covers the action of applets and plug-ins, Eolas targeted Microsofts deep pockets over the action of its Internet Explorer browser and Windows XPs handling of ActiveX controls. Eolas last year won a $521 million jury verdict against Microsoft, which has appealed the verdict.
But after a W3C lobbying effort brought the issue to its attention, the patent office in February found in an initial finding that substantial prior art existed to reject UC Berkeleys patent claims. It was this ruling that was withdrawn, according to Lueck.
“Eolas is attacking HTML itself. This goes to our heart,” W3C Chief Operating Officer Steve Bratt said. Reiterating the W3Cs worries over the issue, he said the patent could force Web site owners to modify their pages and server-side applications.
The W3C insists that content owners would be forced to bear this cost. Even worse, the group says, would be the loss of the millions of Web pages that are no longer actively maintained but still have historical significance. Access to this large pool of content could be broken since there would be no one to pick up the considerable cost of modification.
“Patents arent the problem, [rather] its the licensing fees that are most important,” said the W3Cs Bratt, pointing to new Internet initiatives such as the Semantic Web, a mechanism that enables data sharing across applications both inside and outside an enterprise.
He said the W3C encouraged companies with patents in these areas to offer them royalty-free. “We think it also makes business sense for them.”
The patent re-examination is a separate process from Microsofts court case, said Richard Horning, an IP attorney with Tomlinson Zisko LLP in Palo Alto, Calif., who had not seen the office action document. Still, he said the appeals court will likely be tracking the course of the re-examination in the patent office.
“The office action this week could aid Microsofts appeal and calls into question the outcome of the jurys verdict,” Horning said. While the judge in theory could ignore whats going on in the patent office, Horning said he expects the court to take judicial notice of the findings of the re-examination process and of the differences in evaluation of prior art. The court would likely wait until the patent office process is completed.
“Todays action is another step in the patent offices reconsideration of the Eolas patent,” Microsoft spokesman Jim Desler said in a statement. “This additional step in the process is not out of the ordinary. We have maintained all along that, when scrutinized closely, the Eolas patent would be ruled invalid.
“We believe this action is a positive step for the Internet and the industry and supports our position of invalidity.”