I4i-1, Microsoft 0

Canadian company i4i has claimed that a version of Microsoft Word infringed a patented method for editing documents. The patent row which started in 2007 and has gone to the highest court in the U.S. has finally been decided on in a ruling handed down by the U.S. Supreme Court on Thursday. The court unanimously upheld 30 years of patent law by siding with i4i, which said it would invest the new money back into the company. Microsoft has also been ordered to recall from stores any remaining copies of Word that used the patent.

The Supreme Court fined Microsoft $290 million, which they will have to pay within 15 days. As a result, companies challenging patents in future will have to provide convincing proof that a patent is invalid if they want to have it set aside. i4i sued Microsoft in 2007, alleging that its method for applying XML to documents had been infringed by a version of Microsoft Word. It eventually obtained an injunction that prevented the sale of some versions of the program in the US. It denied the location for the original trial was chosen because it would favour patent litigants: the judge in the case had studied as a computer programmer in school. In March 2010, a circuit court ruled Microsoft had “willfully infringed” i4i’s patent. In July, the validity of the patent was confirmed by the US Patent Office. The two companies had held discussions in 2000 and 2001 about XML and custom XML but no business emerged. Microsoft subsequently began using structured XML in Word, to the annoyance of i4i.

Loudon Owen, chairman of i4i, gloated “Microsoft tried to gut the value of patents by introducing a lower standard for invalidating patents. It is now 100% clear that you can only invalidate a patent based on ‘clear and convincing’ evidence.” Microsoft retaliated by saying that the patent was invalid under a provision of the patent laws that removes protection for inventions that had been on sale in the US for more than a year before the patent application was filed. It transpired that i4i had indeed sold another program more than a year before it submitted its patent application, and the examiner had not considered whether the older program contained the main innovation in the later one before issuing the patent.

Microsoft has already made the changes necessary to make their software comply with the ruling, and of course set aside money if the verdict did not go their way, but are nevertheless appealing the ruling.

Via the Guardian.com

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