Microsoft, the biggest software company in the world, has been ordered by a court to pay $290 million to a small Canadian firm, i4i Inc, after it lost its appeal in the patent infringement case pertaining to its popular Microsoft Word application.
A Federal appeals court refused to change the decision of a Texas jury, which had found the software giant guilty for violating patents held by the Canadian start-up. The court has told Microsoft to stop selling the Word application which contain the infringing code.
The court had found that popular Word program, which is distributed by the Redmond based software giant, contained a custom XML feature which allows users to encode data that can exchanged between programs, whose patent is held by the Canadian company, headed by Loudon Owen.
The court said that "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 also added that Microsoft had captured 80 per cent of the custom XML market using the infringing Word software.
Interestingly, Microsoft was asked to pay an additional $40 million to the original $200 million verdict for intentional infringement along with $50 million for post-verdict damages and interest, taking the penalty to a whooping $290 million.
i4i is not a patent troll it seems. Itdoes have some proper products like the SPL R4 and specialises into Labeling conversion, collaborative authoring, document management and publishing solutions.