Microsoft Loses Patent Appeal, Barred from Selling Word

U.S. Court of Appeals for the Federal Circuit upholds lower court decision that found Microsoft infringed an XML-related patent held by i4i Ltd and orders world's largest software maker to stop selling its popular Word program effective Jan. 11.

Microsoft lost its appeal Dec. 22 of a $290 million judgment that found the world's software maker infringed an XML-related patent held by i4i Ltd of Canada. As a part of the ruling, the U.S. Court of Appeals for the Federal Circuit issued an injunction barring Microsoft from selling from versions of its popular Word program that contain the disputed patent technology.

The effective date of the injunction is Jan. 11, 2010.

"i4i is especially pleased with the court's decision to uphold the injunction, an important step in protecting the property rights of small inventors," i4i founder and co-founder Michel Vulpe said in a statement. Microsoft had no immediate comment on the decision.

The patent, originally submitted in 1994, deals with XML-related formatting for a word processing program, utilizing algorithms to create a data structure called a metacode map, within which resides formatting formation.

A Microsoft's claim is that i4i failed to corroborate its creation date for the technology behind the patent. However, "Unlike in priority disputes, where requiring corroboration of an inventor's testimony makes sense, there is no reason to require corroboration in all instances, and this court never required it," i4i said in a Sept. 8 brief.

But Microsoft also has escape avenues, including settling out of court. The company could also potentially swap out the offending code. On Aug. 4, the U.S. Patent and Trademark Office issued Microsoft Patent 7571169, which describes a "word processing document stored in a single

Small IT companies have a history of winning patent lawsuits against IT giants in the Texas court system. In 2006, for example, Anascape managed to win a $21 million judgment against Microsoft and Nintendo for allegedly violating its patents relating to game controllers; as recently as July, a tiny IT outfit named Tsera sued 23 tech giants, including Microsoft and Apple, over a touch-screen patent.