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February 22, 2007
High Roller
Microsoft
would like nothing more than to eviscerate patent enforcement. Unlike its erstwhile
hardware brethren, IBM, Microsoft has struggled rather fruitlessly monetizing
its own patents. Constantly hammered for infringement, astonishingly dim in
handling settlement negotiations, Microsoft as town crier may have found a willing
audience in its
appeal to the Supreme Court
of its loss to AT&T, though no credit to the bozo Microsoft had as
its mouthpiece. Now it's lost the first round in its wide-ranging battle against
Alcatel-Lucent, nailed with a tab of $1.52 billion. But that's just the start of
it.
Microsoft and Lucent had been sparring over patents since April 2003. Lucent, former equipment manufacturing arm of AT&T before being spun off in 1996, was acquired by Paris-based Alcatel for $11.8 billion last November.
The war continues, with Microsoft filing yet another counterclaim February 16 in Delaware District Court for four communications management software patents. This is on top of other suits going back and forth, including Alcatel assertions towards Microsoft of communications related patents, and against Microsoft's XBox 360 video game machine for patents related to video compression (MPEG-2).
A jury verdict today in the first of six different suits in San Diego found Microsoft liable for $1.52 billion in damages; this for audio (MP3) software technology.
Crying in its beer, Microsoft wept: "We think this verdict is completely unsupported by the law or the facts. Like hundreds of other companies large and small, we believe that we properly licensed MP3 technology from its industry recognized licensor -- Fraunhofer. The damages award seems particularly outrageous when you consider we paid Fraunhofer only $16 million to license this technology." Microsoft will hustle to file its appeal from this Alcatel verdict ASAP.
If it stands, the damage award would make Microsoft the all-time patent loser, topping the 1991 $925 million settlement to Polaroid from Eastman-Kodak for its snitching patented instant film developing technology.
Microsoft has had its own high-roller infringer moments, paying $521 million for the 2004 Eolas patent verdict, which covered ActiveX interactive web browsing. The workaround to avoid infringement amounted to a single click of the mouse. Microsoft was too stubborn to settle the case.
The next trial is on patented speech pattern technology, docketed for late March or early April. Microsoft, Dell and Gateway are defendants. Trial number three, on user interface patents, has the same defendants. Microsoft gets a breather for trial number four, but then faces off solo with the XBox 360 assertion in trial five. Trial six, with the three defendants, is on video technologies.
Small consolation, but Microsoft did manage to get two of Alcatel's patents tossed from the onslaught.
Earlier coverage on the Alcatel-Lucent v. Microsoft imbroglio: May 17, 2006; November 21, 2006; December 18, 2006.
Posted by Patent Hawk at February 22, 2007 7:23 PM | Litigation