Microsoft Wins Appeal in Uniloc Patent Case

Microsoft won its appeal in a patent-infringement case leveled against it by software company Uniloc, which originally won a $388 million judgment against Redmond. The victory represents a bright spot of news for Microsoft on the legal front, where it continues to battle Canadian company i4i in a patent-infringement suit related to Microsoft Word.

Microsoft received one favorable bit of legal news on Sept. 28, when a federal judge ruled that the company did not infringe on a patent held by software company Uniloc. A previous decision in the case had leveled $388 million in damages against Microsoft.

"We are pleased that the court has vacated the jury verdict and entered judgment in favor of Microsoft," Kevin Kutz, a Microsoft spokesperson, told Reuters.

The original lawsuit, filed in September 2003, argued that Microsoft's anti-piracy registration system for Windows XP and parts of Office violated Uniloc's patent for product activation. In 2006, U.S. District Judge William Smith issued a judgment in favor of Microsoft, which Uniloc appealed. According to court documents, Smith initially indicated that he would "appoint an independent expert or special master to assist in deciding the motions given the complicated subject matter," but instead hired an "evening law student who was finishing his Ph.D. in computer science" to review the case. Furthermore, Uniloc claimed, "the intern had numerous ties to Microsoft."

Uniloc's appeal was heard, and in August 2008, the case went back to trial in the U.S. District Court for the District of Rhode Island, resulting in a judgment against Microsoft in April 2009. "We are very disappointed," David Bowermaster, a Microsoft spokesperson, said in an e-mailed statement at the time. "We believe that we do not infringe, that the patent is invalid and that this award of damages is legally and factually unsupported."

This latest twist in the case had Smith once again ruling in favor of Microsoft.

The ruling represents good news for Microsoft, which currently finds itself in legal difficulty over a patent-infringement case leveled against it by Canadian firm i4i. The judgment leveled in that case in August stipulated that Microsoft pay $300 million and pull all copies of Microsoft Word, which allegedly violates i4i's patents, within 60 days.

On Sept. 3, the U.S. Court of Appeals for the Federal Circuit ruled that Microsoft could keep selling Word during the case. In addition, two companies in Microsoft's ecosystem, Dell and Hewlett-Packard, have both filed friends-of-the-court briefs. Microsoft's hearing in appeals court was on Sept. 23, but no verdict has yet been handed down in the matter.