Microsoft loses second XML patent appeal

Microsoft has failed in its attempt to get a judgement against it overturned in a $290 (£160) million patent dispute with Canadian firm i4i.

Toronto-based i4i sued Microsoft back to 2007 for infringing on its XML editor patent, claiming the inclusion of an XML editor in Word 2003 and 2007 was out of order.

The software monopolist appealed a decision by a Texas District Court made in August last year, which found in in favour of i4i. In that round, Microsoft was ordered to pay around $240 million in fines, plus damages amounting to around $50 million. The Redmond outfit was also ordered it to remove the feature from versions of Word 2007 within 60 days.

Microsoft appealed in December and got knocked back. It then had to agree to remove the XML editor by 11 January 2010. In a last-ditch attempt to avoid justice, the firm got its well-heeled lawyers to launch a second appeal on 8 January.

It reckoned the verdict set a "dangerous precedent" for future patent cases. The US Federal Court of Appeals thought otherwise.

In his victory address, i4i chairman Loudon Owen crowed: “The appeals court has again upheld the lower court's decision in its entirety.”

In addition," he said, "it issued a more detailed analysis in concerning the finding of willfulness in this case. The determination that Microsoft willfully infringed i4i's patent stands.”

The three appeal court judges reckoned, "a reasonable jury could have concluded that Microsoft 'willfully' infringed the '449 patent based on the evidence presented at trial.” It had been shown that Microsoft employees had seen demos of 141's technology in action.

"There is no evidence Microsoft ever made a good faith effort to avoid infringement,” the judges wrote. "Internal emails show Microsoft intended to render i4i's product 'obsolete' and assure 'there won't be a need for [the firm's] product.'"

Microsoft now wants all 12 appeals court judges to consider the case. After that it's the Supreme Court. No doubt Microsoft will take is whinge all the way. It normally does.