Microsoft loses US Supreme Court appeal in patent dispute with I4i

SOFTWARE GIANT Microsoft has lost its appeal to the US Supreme Court over alleged infringement of a patent belonging to the Canadian software firm I4i.

The court rejected Microsoft's arguments that the patent is invalid, upholding earlier court rulings that Microsoft had infringed I4i's patent, which relates to custom XML in documents.

The court also refused to accept Microsoft's interpretation of Section 282 of the Patent Act of 1952, which Microsoft argued should only require a "preponderence of evidence" to support its patent invalidity defence, which means it would need only more than half of the evidence to be in its favour for it to successfully challenge the patent.

The court rejected this, saying that the common understanding of this part of the law in the Federal Circuit since 1984 was that it required there to be "clear and convincing evidence" for a patent to be invalidated. This requires a higher standard of evidence, which Microsoft claimed was too high.

Despite its ruling, the Supreme Court hinted that it was not entirely satisfied with the accepted interpretation of Section 282. It said that Congress had specified the required standard of proof when it codified the law in 1952 and that despite many subsequent revisions it never decided to lower the standard of proof requirement, despite severe criticisms. It said that only Congress could change this.

The crux of Microsoft's invalidity argument was that I4i had filed its patent more than a year after the technology was already on the market, which would make the patent invalid under Section 102b of the Patent Act. The software in dispute was I4i's S4 editing software, but there was disagreement over whether or not this software made use of the patent in question, so Microsoft lost its argument by not being able to provide the level of evidence needed to discredit I4i's patent claims.

With the appeals over, Microsoft is now forced to pay $290m in damages to I4i, as per the original verdict handed down in May 2009 by the US District Court for the District of Eastern Texas.

A spokesperson for Microsoft 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." µ