Patent central to Microsoft case invalidated

http://biz.yahoo.com/rc/040305/tech_microsoft_patent_1.html
 
Patent central to Microsoft case invalidated
Friday March 5, 5:48 pm ET 
By Reed Stevenson 


SEATTLE, March 5 (Reuters) - The U.S. Patent and Trademark Office has
invalidated a claim to Web browser technology central to a case against
Microsoft Corp. (NasdaqNM:MSFT <http://finance.yahoo.com/q?s=msft>  - News
<http://finance.yahoo.com/q/h?s=msft> ), a move that could spare the
software giant from paying more than half a billion dollars in damages,
according to documents obtained on Friday.
 
The patent agency's preliminary decision, if upheld, also means that
Microsoft will not be required to make changes to its Internet Explorer Web
browser that would have crippled the program's ability to work with
mini-programs that work over the Internet, such as the Quicktime and Flash
media players. 

Last year, an Illinois jury delivered a $521 million verdict against
Microsoft for infringing on technology developed by a privately held firm,
Eolas Technologies Inc., and the University of California. 


"We have maintained all along that, when scrutinized closely, this patent
would be ruled invalid," Microsoft spokesman Jim Desler said in a statement.



Desler said that Eolas has 60 days to respond to the decision and that the
agency's ruling was "just one step in their review process, but clearly a
positive step." 


Martin Lueck, the lawyer who represented Eolas, said it was not uncommon for
the patent office to invalidate a claim as the first step of a review
process, but said he was confident that the patent office would ultimately
uphold Eolas' claim on the Web technology. 


"They're somewhat routine and typical," Lueck said. 


In response to last year's jury verdict, Microsoft had started to make
changes to its Internet Explorer but suspended those plans last month,
saying that it believed that its claim on underlying technology for the Web
browser would be upheld by the U.S. Patent and Trademark Office. 


Microsoft's Desler noted that the U.S. Patent and Trademark Office has only
invalidated 151 patents out of nearly 4 million patents awarded since 1988. 


Last month, Judge James Zagel of the U.S. District Court for the Northern
District of Illinois upheld the $521 million verdict against Microsoft,
saying jurors were correct in determining that the company had infringed on
patents held by the University of California and Eolas, which jointly hold a
key Web browsing technology patent. 


The judge also suspended an injunction that would have required Microsoft to
make changes to its programs, pending the outcome of the patent office's
review.