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Microsoft battles an alleged patent troll

A company that exists only to sue
Wed Mar 10 2010, 10:34

SOFTWARE BULLY Microsoft threw its toys out of the pram in court yesterday at the beginning of the jury trial against Virnetx.

According to the Seatle PI, the Vole said that Virnetx only existed to sue it and would collapse if the court case failed.

In his opening statement, Virnetx attorney Douglas Cawley told the jury that the inventors of an automatic vitual private network (VPN) technology for the CIA, SAIC employees Edmund "Gif" Munger and Bob Short, obtained patents and shopped around, trying to get companies to purchase their technology.

Apparently they noticed that the Vole was using similar technology in Windows, Office and other products. So they dashed off a letter to the Vole.

In an opening statement, Microsoft attorney Matthew Powers admitted that it got the letter and asked the inventors to back up their claims, and wanted to meet with them. They didn't, and instead they just sued.

Virnetx is a company that was established in 2004 by a man named Kendall Larsen. He owns about 20 per cent of the company or a little bit more, and he received the patents from the SAIC guys to sue Microsoft.

Virnetx has never sold a product and was formed in order to try and make a business out of this invention. The outfit wants $242 million in damages.

The Vole said that one of its employees, Gurdeep Pall, was working on VPN technology as early as 1996. Pall, who now is corporate vice president for Microsoft's unified communications group, is a witness in the trial.

When the inventors had their idea in 1999, Microsoft already had a confidential business plan talking about its strategy of how it would win in the marketplace. It also has shedloads of documents that show it expected to make a lot of dosh off the back of the invention it had.

Powers argued that Munger and Short couldn't find buyers for their invention and not even their former company SAIC was that interested.

He said that that there were plenty of pre-existing examples of similar technology, which made the patent invalid.

The jury faces the question of why, when you hear Virnetx say that it solved the problem of VPN security, there were no security companies interested in that.

The trial will continue through this week, and a verdict could come as soon as next week. µ



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