To avoid claims stemming from Microsoft's loss of a patent-infringement case, Office 2003 customers with Access 2003 should apply the latest Office service pack (Office 2003 SP2) to new installations, and Office XP customers with Access 2002 should apply a patch to Access on all new installations. However, installations that were completed before Jan. 2006 are not affected, Microsoft says.

In other legal news, Microsoft could face daily fines of up to €2 million (approximately US$2.4 million) for failing to release adequate documentation about server protocols in a timely fashion, has won two patent battles while facing another one, and has settled a dispute with Google over former employee Kai-Fu Lee.

Office Patent Fallout

In June 2005, Microsoft lost a patent infringement case against Guatemalan inventor Carlos Amado regarding a feature that allows data from an Access database to be displayed in an Excel spreadsheet. In Jan. 2006, Microsoft sent an e-mail to volume licensing customers explaining which products are affected and what customers should do to comply with the legal ruling. If customers who receive the notification do not take these actions, they will technically be in violation of their licensing agreements and will not be covered by Microsoft's indemnification policy, which covers legal costs associated with patent-infringement and other intellectual property cases involving Microsoft software. Patent infringement lawsuits against end users of an infringing product are rare, but not unprecedented.

The requirements are as follows:

Office without Access. Customers using versions of Office that don't include Access need not take any action.

Office 2003 with Access 2003. For new installations of Office 2003 editions that include Access 2003, customers must update the installation with the latest available service pack, Office 2003 SP2. ("New" installations are defined as any installation that was not complete at the time the customer received notice of the problem.) Because many companies prefer to have consistent desktops, this might force these customers to upgrade older installations to the latest service pack as well.

The service pack removes the infringing feature and changes the way Office 2003 functions. Before the patch is applied, customers can link an Excel worksheet to an Access database so that any changes to the data in Access will be reflected in Excel. After SP2 is applied, this feature will no longer work, and customers must either make all changes in Excel (and they will be reflected in Access) or export the data to a new Excel file any time they change the data in Access. If the service pack is applied, any production systems that rely on the original behavior will need to be modified to reflect the change.

Customers with Office 2003 installations in place before the notification date are not legally required to install SP2 on those installations, but the company "strongly recommends" that they do so in order to reap the other benefits of that service pack. Existing Office 2003 volume license customers should receive Office 2003 SP2 in their media kits, and all new shipments of the product (retail or volume license) come with SP2.

Office 2003 SP2 can also be downloaded at www.microsoft.com/downloads/details.aspx?FamilyId=57E27A97-2DB6-4654-9DB6-EC7D5B4DD867&displaylang=en.

For more background on the service pack, see "Office 2003 SP2 Available" on page 26 of the Nov. 2005 Update.

Office XP with Access 2002. For new installations of Office XP editions that include Access 2002, customers must apply a patch to Access 2002 that removes the infringing code and associated feature. Customers are not required to install the patch on existing installations.

This patch is available at www.microsoft.com/downloads/details.aspx?FamilyId=7497D7F0-BEF5-4054-B854-B1240B5135F5&displaylang=en.

The Knowledge Base article describing the patch is KB904018 and is available at support.microsoft.com/?kbid=904018.

EU Says Documentation Inadequate

The European Commission (EC), the body that handles antitrust and competition law for the EU, has threatened to fine Microsoft up to €2 million per day for failing to provide adequate documentation about communications protocols that the company is required to license.

As part of the EC's Apr. 2004 ruling against the company, Microsoft is required to license certain protocols that allow Windows clients and Windows servers to communicate. The EC's goal with this remedy is to enable Microsoft's competitors to create server products that can use these protocols in precisely the same way as Windows servers do. This would prevent Microsoft from illegally leveraging its desktop OS monopoly to gain an advantage in the server market, the EC reasoned.

Microsoft began licensing these protocols in early 2005 (after Microsoft's appeal to stay the penalty failed), but the EC complained in June that the documentation was insufficient and gave Microsoft until December to provide better information. In December, a compliance officer said the information was still insufficient, claiming that developers "would be wholly and completely unable to proceed on the basis of the documentation" and calling for a "quite drastic overhaul."

The EC gave Microsoft until Feb. 15, 2006, to object to this finding. In the interim, Microsoft offered to license the Windows source code underlying the protocols, but an EC spokesperson said that this would not necessarily be sufficient to resolve the complaint. The Feb. 15 deadline passed without Microsoft taking further steps; instead, the company noted that it had already provided over 12,000 pages of documentation and offered 500 hours of technical support to licensees. However, the EC has been fairly consistent in asserting that the quality of the documentation, not its quantity, is the problem.

As of press time, the EC had not imposed daily fines, but could do so at any time. Meanwhile, Microsoft has appealed the original ruling, and hearings are scheduled to begin in April.

Patent Cases

According to a Dec. 2005 financial filing, Microsoft is currently involved in more than 35 lawsuits involving patents. Since Dec. 2005, Microsoft has prevailed in two of these cases and faced a new one.

FAT patents upheld. The United States Patent and Trade Office (USPTO) issued a final ruling in Jan. 2006 upholding the validity of two Microsoft patents related to the File Allocation Table (FAT), a file indexing system used to describe where the parts of a file are stored on a physical storage medium, such as a hard drive or removable storage device. The patented technology is frequently used by the makers of devices that use removable media (such as digital cameras with removable memory cards), and in Dec. 2003 Microsoft began charging licensing fees for the use of this technology. In 2004, a nonprofit group called the Public Patent Foundation (PPF) asked the USPTO to reexamine several of these patents, but the USPTO disagreed with the PPF's claims of prior art and upheld the patents.

Microsoft wins RCT patent case. Microsoft has prevailed in a patent-infringement case filed by Research Corporation Technologies (RCT), a company that specializes in commercializing academic patents. RCT sued Microsoft in 2001 over several patents related to printer technology that enables the creation of shaded areas by using patterns of dots. Although RCT won a summary judgment in Jan. 2004, Microsoft appealed, and a subsequent judge issued two rulings in Apr. 2005 and Jan. 2006 invalidating RCT's claims.

Visto sues. Visto, a developer of mobile e-mail software, filed a lawsuit in Dec. 2005 claiming that Windows Mobile 5.0, Microsoft's latest OS for "smart" wireless phones and other mobile devices, infringes on three of its patents related to transferring information between servers and cellular phones.

The case comes on the heels of a similar, highly publicized dispute between two other companies, NTP and Research In Motion (RIM): NTP sued RIM for patent infringement and won an injunction that could force RIM to shut down its popular BlackBerry mobile e-mail service. RIM's appeals have almost been exhausted, and it could be forced to stop operating BlackBerry in spring 2006. Visto licensed NTP's patents for its own software shortly before suing Microsoft.

Lee Case Resolved

Microsoft has settled a dispute with Kai-Fu Lee, a former executive who quit to work for Google in summer 2005. Microsoft filed a lawsuit shortly after Lee's departure, claiming that Lee's terms of employment forbade him from working for a direct competitor for one year after quitting Microsoft. In Sept. 2005 Microsoft won a preliminary injunction forbidding Lee to work on Google's search technology but allowing him to recruit employees for a Google research lab in China.

The case was slated for trial in Jan. 2005, but the two companies and Lee reached a private agreement to settle all aspects of the case before the trial commenced. As part of the agreement, both companies are forbidden from disclosing any further details or discussing the case in public.