Will Microsoft’s Latest IP Loss Stick

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NEW YORK–The Bill Gates-founded Microsoft Corporation is in a familiar position on Wednesday. A Rhode Island federal jury found Microsoft guilty of infringing Uniloc’s software security patents and ended with a demand that the company pay $338 million. Microsoft has seen such a demand before, but often escapes it. The question on many minds is whether they will actually pay this time around, or escape on appeal.

Uniloc’s lawyers—Paul Hayes and Dean Bostock at Mintz, Levin, Cohn, Ferris, and Popeo—finished with a huge win. The loss was handed to a Fish & Richardson team headed by Frank Scherkenbach.

Microsoft has been on the list for patent infringement various times, but this was the fifth-largest verdict in history, said the Mintz lawyers.

The corporation actually holds the record for being ordered, by a San Diego jury, to pay $1.53 billion for infringing on Alcatel-Lucent’s patents for MP3 digital audio technology. Another case ended with $512 million to Alcatel-Lucent and $521 million won to Eolas Technologies Inc.

Microsoft has had luck with the appeals court in eliminating the verdicts. The $1.53 billion verdict was overturned. Microsoft appealed the $521 million verdict and eventually settled with Eolas for $30.4 million in 2007. The appeal for the $512 Alcatel-Lucent decision is on appeal now.

“Microsoft has certainly seen some large verdicts against it in the last few years,” observed Stephen Akerley, a patent litigator with O’Melveny & Myers, who wasn’t involved with this week’s case. “However, there are always appealable issues in these cases. And if you look back, Eolas ultimately settled, Alcatel-Lucent is still going on—it’s impossible to tell where this case will end up.”

Microsoft emailed a statement and said that they are “very disappointed in the jury verdict. 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.”

Fish & Richardson has represented Microsoft against Alcatel-Lucent in both cases, at trial and on appeal. A spokesman said the firm has no comment.

 

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