Toronto's i4i wins $290-million patent infringement battle against Microsoft
LuAnn LaSalle, The Associated Press,On Thursday June 9, 2011, 1:26 pm EDT
By LuAnn LaSalle, The Associated Press
Canadian software company i4i Inc. has emerged the victor in a patent battle with tech super heavyweight Microsoft after the U.S. Supreme Court upheld a judgment that i4i be paid US$290 million for patent infringement.
The high court on Thursday refused to throw out an earlier ruling that found the world's largest software maker wilfully infringed on a patent in its Microsoft Word software and ordered it to pay $290 million to i4i and to stop selling versions containing the infringing technology.
The landmark decision has broad implications for the patent world as it essentially upholds the basis for many years of U.S. patent decisions.
"It's one of the most important business cases the U.S. Supreme Court has decided in decades," said i4i chairman Louden Owen.
"Microsoft's appeal and, along with their gang of supporters who decided they would file on their behalf, were taking great strides to try to throw a lot of uncertainty into the system," he said from Toronto.
"The unanimous decision has very clearly confirmed the current state of the law and it has added a great deal of certainty to the business community," Owen said of upholding patents.
Toronto-based i4i sued Microsoft (Nasdaq:MSFT) in 2007, saying it owned the technology behind a tool used in Microsoft Word. The technology in question gave Word 2003 and Word 2007 users an improved way to edit XML, which is computer code that tells the program how to interpret and display a document's contents.
Microsoft wanted the judgment against it erased because it claimed a judge used the wrong standard in instructing the jury that came up with the award.
The software company said a jury should determine a patent's validity by a "preponderance" of the evidence instead of the "clear and convincing" evidence standard instructed by the judge.
The Supreme Court said the "clear and convincing" standard was the correct one.
Justice Sonia Sotomayor, who wrote the court's opinion, said the courts have interpreted the law the same way for 30 years. During this period, Congress has often amended the patent law, she said.
"Not once, so far as we (and Microsoft) are aware, has it even considered a proposal to lower the standard of proof," Sotomayor said.
Microsoft now sells versions of Word that do not contain the technology in question.
During the trial, lawyers for i4i and the Obama administration had argued that there was little point in granting patents to inventors if corporations can simply infringe upon them with impunity.
Several high-powered companies supported Microsoft in its battle against i4i, including Apple, Google and Cisco Systems.