Microsoft Appeals in Word Patent Case Set for Sept. 23

Microsoft will appeal a patent-infringement case on Sept. 23, weeks after a U.S. District Court in East Texas ordered the company to pull copies of Microsoft Word from store shelves and pay nearly $300 million in fines. A small Canadian firm, i4i, argued that Microsoft had violated its patents for customized XML code that had been integrated into Word.

Microsoft's appeal in a well-publicized patent-infringement case will now be heard by the Federal Circuit on Sept. 23.

The appeal will attempt to reverse a verdict, handed down on Aug. 12 by the U.S. District Court in East Texas, which ordered Microsoft to pay nearly $300 million in accumulated fines and pull copies of Microsoft Word from store shelves within 60 days. The court had ruled that Microsoft violated an X M L-related patent held by i4i, a small Canadian company.

Microsoft Word allegedly utilizes a custom X M L code covered by the patent.

Microsoft has appealed such patent-infringement cases in the past, raising the prospect that the current proceedings could drag on for years. However, in both public statements and an interview with eWEEK, the heads of i4i have insisted that they will pursue the case to its logical conclusion.

"We firmly believe that the U.S. District Court made the right decision on the merits of the case," Loudon Owen, chairman of i4i, said in a statement after news of Microsoft's appeal. "This is a vital case for inventors and entrepreneurial companies who, like i4i, are damaged by the willful infringement of their patents by competitors; particularly competitors as large and powerful as Microsoft."

His company, Owen added, "appreciated and welcomed" the expedited schedule put forth by the Court of Appeals.

In an emergency motion filed on Aug. 18, Microsoft's legal counsel suggested that a refusal to stay the court's injunction during the appeal would have the potential to cause widespread damage:

"Even if Microsoft ultimately succeeds on appeal, it will never be able to recoup the funds expended in redesigning and redistributing Word, the sales lost during the period when Word and Office are barred from the market, and the diminished goodwill from Microsoft's many retail and industrial customers."

Despite analyst suggestions over the past few weeks that Microsoft could potentially use a technological workaround for Word to circumvent the lawsuit, the company's statement seems to suggest that such an alteration to its X M L code would be a massive undertaking.

Small IT companies have a history of filing patent lawsuits against IT giants in the Texas court system, and sometimes winning verdicts to the tune of several millions of dollars. Microsoft was already sued in July, along with 23 other tech companies, by a tiny IT outfit named Tsera over a touch-screen patent.

In an eWEEK interview on Aug. 17, Loudon Owen suggested that filing i4i's lawsuit against Microsoft in East Texas held several advantages.

"The law firm that we're using is based in Texas, and they're at the top of the heap in terms of litigation advice," Owen said. "Second, the jurisdiction is federal, so it shouldn't matter where you file. The third element we found is: There's a great deal of expertise in that jurisdiction. They're very sophisticated judges."