NOTE: the judgment in the case discussed below can now be accessed here.According to breaking news in Times Online, software company Microsoft has been barred by the US Federal Circuit Court from selling its word processing Word software in the United States and must pay US$290 million in damges for infringing a patent held by a small Canadian software company, i4i (for earlier developments in this trial see the AmeriKat posts on the IPKat weblog here, here, here and here). Says Times Online,
What is interesting here is that, following the earlier ruling of the US Supreme Court in eBay v MercExchange (here, noted by the IPKat here), many commentators felt that the loss of what was regarded as an automatic entitlement to injunctive relief would cripple patent owners. This decision has shown that this is unlikely to be so and that, at least where the defendant has a good chance of amending its product within a reasonable time so as to avoid infringement, an injunctive order will certainly be an option for the court in the exercise of its discretion.
"The ruling ... prevents Microsoft from selling any versions of Word 2003 or Word 2007 after January 11 2010. Copies of these products sold before this date are not affected.Microsoft is said to be considering applying for a rehearing or an appeal to the US Supreme Court.
Loudon Owen, Chairman of i4i, described the ruling as “a war cry for talented inventors whose patents are infringed”... Mr Owen said that the XML feature at the heart of the dispute was an important tool for users such as drugs companies who routinely handled large amounts of data.
By removing it from its Word 2007 software Microsoft would disadvantage those users. ... He did not rule out licensing the XML feature to Microsoft. "They know where to find us if they want to talk," he said.
In court documents filed during its long-running dispute with i4i, Microsoft had originally claimed that a ban on sales “will inflict irreparable harm on Microsoft by potentially keeping the centerpiece of its product line out of the market for months."
But yesterday the company brushed off the ruling, saying that it had already “put the wheels in motion” to remove the disputed feature from its products.
“We expect to have copies of Microsoft Word 2007 and Office 2007, with this feature removed, available for US sale and distribution by the injunction date,” Kevin Kutz, Microsoft’s director of public affairs, said.
He added that the beta versions of Microsoft Word 2010 and Microsoft Office 2010, which are available now for downloading, do not contain the technology covered by the injunction.
The ruling follows an earlier injunction issued by a US disctict court in Texas barring Microsoft from selling recent versions if its Word software, after the company was found to have wilfully infringed a patent held by i4i, a Toronto-based technology company, through the use of a technology used to classify documents for retrieval by computers.
That injunction was stayed while Microsoft appealed.
In the latest ruling, the three-judge panel said: "A small company was practicing its patent, only to suffer a loss of market share, brand recognition, and customer goodwill as the result of the defendant's infringing acts."
It noted that the “district court found that Microsoft captured 80 percent of the custom XML market with its infringing Word products, forcing i4i to change its business strategy." ...".
What is interesting here is that, following the earlier ruling of the US Supreme Court in eBay v MercExchange (here, noted by the IPKat here), many commentators felt that the loss of what was regarded as an automatic entitlement to injunctive relief would cripple patent owners. This decision has shown that this is unlikely to be so and that, at least where the defendant has a good chance of amending its product within a reasonable time so as to avoid infringement, an injunctive order will certainly be an option for the court in the exercise of its discretion.
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