Word Injunction Upheld

A U.S. appeals court has upheld a patent-infringement ruling against Microsoft and has ordered the company to pay patent holder i4i US$290 million in damages and to license the patent or remove the infringing feature from Word by Jan. 11, 2010.

The patent in question is number 5,789,449 (‘449) and describes a method for processing and storing content in a document separately from “metacodes” that describe the document’s structure. In 2007, Toronto-based i4i sued Microsoft in the Eastern District of Texas, alleging that a feature of Word 2007 that allows users to combine text with custom XML schema infringed the ‘449 patent. A jury found in i4i’s favor in May 2009, ordering Microsoft to pay US$200 million in damages. In August, the judge raised the fine to US$240 million and issued a permanent injunction ordering the company to stop selling Word with the infringing feature by Oct. 2009.

Microsoft was granted a stay of the injunction pending appeal, but in December the U.S. Court of Appeals for the Federal Circuit agreed with the lower court’s ruling on all counts except one: because Microsoft said it would take at least five months to remove the offending feature from Word, the appeals court said that Microsoft should have been given five months rather than 60 days to make the change. Consequently, the appeals court ordered Microsoft to remove the infringing feature from Word by Jan. 11, 2010, five months after the district judge’s ruling. The court also awarded an additional US$50 million in interest charges, bringing the total fine to US$290 million.