Microsoft Slapped With $388 million Fine Over Patent Dispute

Microsoft Corp. has been instructed to pay as much as $388 million in penalty for violating a patent held by the anti-piracy software firm Uniloc Inc.

A jury in Rhode Island ruled out that the software giant had infringed Uniloc’s patent on software technology that creates unique identities for certified users as well as check illicit use or copying of the programs.

Uniloc Inc., based in Singapore and California, achieved the aforementioned patent in 1992, and filed a lawsuit against Microsoft back in 2003, in which the company claimed that the software giant used the security technology to prevent illegitimate use of its Windows XP operating system and some components of its Office suite.

The software giant said that it is very disappointed with the ruling and is planning to appeal against it. The damages fine is said to be one of the largest posed in the patent law infringement case.

Along the same line, a Microsoft spokesperson said in a statement, “We believe that we do not infringe, that the patent is invalid and that this award of damages is legally and factually unsupported. We will ask the court to overturn the verdict”.

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Our Comments

This is blatantly ironic. Microsoft being punished for lifting code illegally to produce an application that prevents this action in the first place. The fine comes at a bad time given that the amount will have to be paid in cash. Although Microsoft sits on a substantial cash pot, this will have an impact on its bottom line and could affect its share price.

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