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Microsoft loses Supreme patent fight over Word

Have-it-both-ways defense fails

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America's top court has rejected Microsoft's appeal against a ruling that Microsoft Word infringed on patents owned by a tiny Canadian software maker..

The US Supreme Court unanimously upheld an earlier court's ruling that said Microsoft willfully infringed on i4i's XML patents in Word 2003 and 2007.

Microsoft was ordered to pay i4i almost $300m in damages and told in the ruling that it could no longer ship Word 2003 and 2007 with the offending code. Microsoft issued a patch to sidestep the XML code and continue selling its software.

With nowhere left to go in this four-year case, Microsoft said on Thursday that it would now concentrate on trying reform US law to prevent abuses of the patent system. "This case raised an important issue of law which the Supreme Court itself had questioned in an earlier decision and which we believed needed resolution," a Microsoft spokesperson said, "While the outcome is not what we had hoped for, we will continue to advocate for changes to the law that will prevent abuse of the patent system and protect inventors who hold patents representing true innovation."

“While the outcome is not what we had hoped for, we will continue to advocate for changes to the law that will prevent abuse of the patent system and protect inventors who hold patents representing true innovation.”

i4i brought its case in 2007 in the patent holder friendly US District Court of Eastern Texas, with the original verdict delivered in May 2009. i4i chairman Loudon Owen told The Register that the fact that the Supreme Court had sided unanimously with the Texas-court's decision proved it had been well written.

In its defense against i4i, Microsoft tried change the rules for awarding patents and for ruling on patent litigation cases. It had argued that defendants need only persuade a court that a patent was invalid using a "preponderance of evidence" and that a "preponderance standard" should also apply when evidence is presented that had not been available to the USPTO when it had granted the patent.

The Supreme Court judges didn't buy it. The court decided that the burden of establishing whether a patent is invalid rests on the party asserting it's not valid. i4i lauded the Supreme Court's decision to uphold the existing standard, saying Microsoft had tried to "gut the value of patents" by introducing a lower standard for validation.

Owen, in a statement, called it one of the most significant business cases the Court has decided in decades. "Affirmation of the Federal Circuit on a ruling in favor of patent holders is virtually unprecedented. While this ruling maintains the prevailing standard, the innovation community must be ever-vigilant to defend its property rights," he said.

On that note, Microsoft is actively using the existing system that it feels is unfair and ripe for abuse to lodge claims against others. Microsoft has lodged patent infringement claims against Nook makers Barns & Noble, Foxconn and Inventec, and Android phone maker Motorola. It has also rattled its saber at others who have settled without going to court. These include Android phone maker HTC and Linux sat nav specialist TomTom.

Talking to The Reg, Owen called this habit of attacking others while trying to switch the argument against i4i “cognitive dissonance”. “We can’t get inside their head, but we know in this case [i4i] they took the opposite view to us,” he said.®

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