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Supreme Court Rules Against Microsoft In i4i Case 162

Posted by Soulskill
from the done-and-done dept.
CWmike writes "The US Supreme Court has let stand a $300 million patent infringement ruling against Microsoft, granting a victory Thursday to i4i (PDF), which filed the lawsuit back in 2007. The legal battle already forced Microsoft to modify certain functionality in its Word application in 2009, when the US District Court for the Eastern District of Texas ruled in favor of Toronto-based i4i and told Microsoft to stop selling Word in the US. At issue was an i4i patent that covers technology that lets users manipulate the architecture and content of a document, which i4i alleged Microsoft infringed upon by letting Word users create custom XML documents. Microsoft removed the feature. 'This case raised an important issue of law which the Supreme Court itself had questioned in an earlier decision and which we believed needed resolution. While the outcome is not what we had hoped for, we will continue to advocate for changes to the law that will prevent abuse of the patent system and protect inventors who hold patents representing true innovation,' Microsoft said in a statement."
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Supreme Court Rules Against Microsoft In i4i Case

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  • I wonder if the supreme court will have to pay royalties for the exercise of "Godly Powers?" http://idle.slashdot.org/story/11/06/08/1231254/Man-Tries-to-Patent-His-Godly-Powers [slashdot.org]

  • by arunce (1934350)
    they have a problem with patents and want something else so they can be the only rulers?
  • So... (Score:3, Insightful)

    by errandum (2014454) on Thursday June 09, 2011 @11:25AM (#36389588)

    One of the patent hoggers got what they deserved.

    The whole patent system needs a revamp but it is to protect us from companies like Microsoft, Apple and whatnot. They are the ones stiffing innovation.

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      Shame that, if there is any patent reform legislation, it will be written by Microsoft, Apple and whatnot.

  • by KingSkippus (799657) on Thursday June 09, 2011 @11:26AM (#36389606) Homepage Journal

    I know it's popular to portray Microsoft as the Evil Empire, but this totally sucks. While you all are laughing at the irony, keep in mind that this is only going to convince big companies like Microsoft, Apple, Google, Amazon, Cisco, etc. that they need to hunker down even more in developing extensive patent portfolios and vigorously defending them. It's the only way to survive as a business these days, to have enough goods to establish a mutually assured destruction scenario if someone sues you. Unfortunately, it also looks like patent trolls are going to be encouraged from now on. As a society, we've completely missed the narrow window of opportunity we had to change the system to prevent this kind of abuse. I guess we were too busy watching Snooki, American Idol and Dancing with the Stars, I hope it was worth it.

    This system is so hideously broken, so apparently messed up with no will or way to change it, that it sometimes makes me want to get out of the IT industry altogether.

    • by Anonymous Coward on Thursday June 09, 2011 @11:39AM (#36389788)

      Mutual Assured Destruction cannot be used to defend against patent trolls. They create no products, therefore cannot possibly infringe on any patents, which means no matter how many patents you have, you can't counter sue them. Their whole business plan consist of buying patent on the cheap, and suing anybody who makes a profit in any area remotely related to the patent.

      • by Bozdune (68800)

        Indeed, this is the key point. The defensive patent portfolio strategy anticipated lawsuits from *competitors*. Nobody anticipated that law firms full of shysters and hacks -- with no asset except some moldy patent filed back at the beginning of time by a random idiot -- would be the problem.

        So I agree with a later commenter, who points out that this is precisely why this is GOOD news. Let the big companies get hurt AGAIN AND AGAIN by trolls. I want blood on the streets. I want them to feel REAL PAIN.

    • by mooingyak (720677) on Thursday June 09, 2011 @11:40AM (#36389802)

      I agreed with you completely until right here:

      As a society, we've completely missed the narrow window of opportunity we had to change the system to prevent this kind of abuse.

      Maybe I'm an optimist, but I believe that software patents are doomed. The major corporations all have little to nothing to gain from them and waste time and resources acquiring them defensively.

      • by spongman (182339)

        once the cabal of large companies has invested huge amounts of capital on boosting the strength of their patent portfolios, they're not going to allow that investment to evaporate overnight if they think it gives them an advantage in the market.

        initially these companies have been willing to lobby for patent reform, but as the trolls increase their attacks, and the companies grow their defense portfolios, that lobbying effort is going to diminish until the point when they start lobbying against patent reform

      • Lawyers > major corporations :P

      • by Hatta (162192)

        Maybe I'm an optimist, but I believe that software patents are doomed. The major corporations all have little to nothing to gain from them and waste time and resources acquiring them defensively.

        The major corporations gain an advantage over the smaller corporations who can't afford to maintain a giant patent portfolio. Anything that creates a barrier to entry is good for the major players in the market.

    • by cozzbp (1845636) on Thursday June 09, 2011 @11:40AM (#36389804)

      I know it's popular to portray Microsoft as the Evil Empire, but this totally sucks.

      I totally agree, and I also think it's totally asinine to celebrate this as a victory, regardless of what you think about Microsoft.

      Patent No. 5,787,449 [google.com] is the most broad-ass patent I've ever read in my entire life. The only person this is a victory for, is that dumbass Loudon Owen [cnet.com].

    • While I agree with you that this is a bad decision with negative consequences for the industry, well, you did mention the irony here so I won't have to explain why I am experiencing a twinge of schadenfreude right now.
    • by Anonymous Coward on Thursday June 09, 2011 @11:47AM (#36389916)

      While I agree, I'm not sure this case specifically was the venue to change that. It appears that the case revolved around whether a patent can be found invalid by "preponderance of the evidence" or by "clear and convincing evidence". The Court held "Section 282 requires an invalidity defense to be proved by clear and convincing evidence".

      That the burden of proving a patent invalid falls on the party claiming it is invalid sounds good to me; otherwise small-time patent owners would never be able to go to court and prove (over and over) that all their patents are valid against a deep-pocketed adversary.

      http://www.supremecourt.gov/opinions/10pdf/10-290.pdf

      • by artor3 (1344997)

        So instead, those small-time patent owners will have to go to court and prove that the patents their product is accused of violating are invalid, against a deep-pocketed adversary.

        The system as it presently exists won't work no matter where you set the level for the burden of proof.

    • Yeah it's *THIS* decision that's going to make Microsoft use software patents even more.

      moron.
    • by drinkypoo (153816) <martin.espinoza@gmail.com> on Thursday June 09, 2011 @11:57AM (#36390096) Homepage Journal

      I know it's popular to portray Microsoft as the Evil Empire, but this totally sucks.

      While it totally sucks, Microsoft is the Evil Empire. to wit, from the summary:

      While the outcome is not what we had hoped for, we will continue to advocate for changes to the law that will prevent abuse of the patent system and protect inventors who hold patents representing true innovation,' Microsoft said in a statement."

      So when you say:

      this is only going to convince big companies like Microsoft, Apple, Google, Amazon, Cisco, etc. that they need to hunker down even more in developing extensive patent portfolios and vigorously defending them.

      You actually miss the point about why Microsoft is evil. Instead of talking about how software patents are ridiculous, they publicly announce their intention to manipulate the system such that big corporations like them will be able to crush small players (of ill repute or not) like i4i. Got to love that name, huh? Of course, you have to do a little translation. "prevent abuse of the patent system" means "avoid Microsoft and its ilk being harmed by the patent system" and "true innovation" means "strong market position". To Microsoft, it is only justified to wield such a portfolio if you actually use the patents, because they do. There is at least a certain logic to this position.

      • by artor3 (1344997)

        Actually, you're the evil one! Observe:

        When you say:

        Of course, you have to do a little translation.

        With a little translation, I deduce that you mean:

        I will rape and murder a dozen schoolchildren.

        See how easy it is to prove someone evil when you just stick words in their mouths? You literally just invented an evil position for them out of whole cloth, and then used it to prove that they were evil.

        • by idontgno (624372)
          traduttore, traditore [trustedtranslations.com]
        • by makomk (752139)

          No inventing necessary. The Microsoft exec in charge of this scheme was practically gloating in internal e-mails about how integrating the functionality of i4i's main product into Word would drive i4i out of business. Not to mention that Microsoft have a long history of doing exactly that...

        • by drinkypoo (153816)

          See how easy it is to prove someone evil when you just stick words in their mouths? You literally just invented an evil position for them out of whole cloth

          Not only did I not invent ANY position for Microsoft they haven't repeatedly proved themselves to be standing on, but I clearly didn't literally invent anything using cloth, whole or otherwise, in my comment. You literally misused the word literally. Apparently it isn't that easy.

          By their actions shall you know them. You can know me by mine; I am sometimes wrong, I am always outspoken. You can know Microsoft by theirs, too. They are convicted abusers of their monopoly position.

    • It's a huge mix of emotions. Microsoft hatred. Hating patents. Awareness that this hurts every company that ever uses XML. Realizing that this hurts every company that ever uses XML, and thus could be the end of XML! There's too much hate. Let the world move on, and dance!
    • Patent trolls? I though i4i had a legitimate case here and have real products.

      • You must be new here. In Slashdot newspeak, "patent troll" is any company that sues over any patent it holds.

      • by Anonymous Coward

        Hey don't put logic in the way of a slashdot rant against patent trolls. It doesn't matter that i4i have valid case, real products and that their patents has very limited effect on XML - it's really all about patent trolls and a huge foreigner Canuckastanian company putting the boots to an American company by misusing American courts............ mmmmm now that's truthiness!

      • by jmcvetta (153563)

        Patent trolls? I though i4i had a legitimate case here and have real products.

        Depends on what you mean by "legitimate". If you're saying they had a legally valid case under the rules of the Amerikan injustice system, then yes. But legitimacy is a broader concept than validity. Their case is only legitimate if one believes the ownership of ideas is itself a legitimate practice. Many of us here consider ownership of ideas to be deeply immoral, even akin to slavery. So regardless the legalistic validity of i4i's case, it can't possibly be legitimate.

    • by makubesu (1910402)
      They'd take this approach, but unfortunately somebody already patented the business practice of patent hoarding.
    • by c (8461)

      > this is only going to convince big companies like Microsoft, Apple,
      > Google, Amazon, Cisco, etc. that they need to hunker down even
      > more in developing extensive patent portfolios and vigorously defending them.

      That's a strategy which only really works against someone who builds a product which might infringe on one of their patents. It doesn't do much to prevent exposure to patent trolls, or companies who discover they can make more money from lawsuits than actually building products.

    • by oakgrove (845019)

      I know it's popular to portray Microsoft as the Evil Empire, but this totally sucks.

      I am no friend of Microsoft as anyone who has read my past posts can attest to but I agree this just stinks. Software patents serve the purposes of the big boys and do nothing but stifle the little guys.

      Case in point, I was making a spinner dialog for an Android app this morning and was searching for a way to directly change the xml values in the string resource that populates the drop down box. Well, looking at this very case, I can see why the Android sdk doesn't allow you to directly manipulate that

    • by JamesP (688957)

      I disagree

      I hope patent trolls keep pounding lawsuits against MS, hopefully for billions of dollars.

      Only then MS will be convinced and set their congresscritters to change something

      Meanwhile, they can cry me a river.

    • by Locutus (9039)
      no, that doesn't work again patent trolls who will have not products which your "vast patent portfolio" can be leveraged again. And if you don't think Microsoft fought this vigorously, they took it all the way to the Supreme Court. So this is not going to convince big companies they need more patents. That is being done by Microsoft, Apple, and Oracle now by going after Android using vendors and promotes the concept of mutual assured destruction in the patent field much like how the cold war concept caused
  • by PickyH3D (680158) on Thursday June 09, 2011 @11:27AM (#36389626)

    I guess we should all be patenting the obvious use cases of all standards.

    Same story, different day. What a joke. i4i should go around suing every company using XML with predefined tags.

    • by Tsingi (870990) <<graham.rick> <at> <gmail.com>> on Thursday June 09, 2011 @11:37AM (#36389754)

      I guess we should all be patenting the obvious use cases of all standards.

      Same story, different day. What a joke. i4i should go around suing every company using XML with predefined tags.

      Yes, this is a joke. Microsoft is using XML to do something XML was designed to do, how can someone patent that?

      It hurts a little to say this, but Microsoft is in the right.

    • by Trepidity (597) <delirium-slashdotNO@SPAMhackish.org> on Thursday June 09, 2011 @11:58AM (#36390126)

      This specific Supreme Court review didn't really touch on the technology issue, though, just the legal standard of proof, since the question they were reviewing was a pretty narrow one of statutory construction. Section 282 of the patent code specifies that, when a patent is challenged in court:

      1. "A patent shall be presumed valid."

      and

      2. "The burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity."

      I disagree with that as a matter of policy, but that's what the Patent Act says, and absent any claim that it's unconstitutional, the only thing the Court was asked to decide here is what "burden" means, legally.

      The Federal Circuit (a lower appeals court) has held for some years now that "burden of establishing invalidity" means that the party bringing a challenge must show "clear and convincing evidence" of the patent's invalidity. Microsoft argued that, for prior art that the patent office had not already considered in its review record, the burden of establishing invalidity should be lower, with a "preponderance of the evidence" standard.

      I'd prefer the lower burden of proof, but this question isn't really at the heart of why we have a patent mess; at best it's a symptom.

      • by Rob Y. (110975)

        1. "A patent shall be presumed valid."
        and
        2. "The burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity."

        Hmmm. Maybe there is something unconstitutional. At the bottom of it all, this case is about the 'crime' of patent infringement, and if there's any question that the patent is not valid, then the violator should have the opportunity to 'establish invalidity' with the presumption of innocence. I.e. no collection of royalties or 'ceasing to infringe' until the validity of the patent has been established. Just because the court is supposed to presume the patent is valid when challenged, doesn't mean that a

        • by bye (87770)

          Just because the court is supposed to presume the patent is valid when challenged, doesn't mean that a supposed infringer isn't also entitled to his presumption of innocence.

          This is a civil case not a criminal case, there's no presumption of innocence.

          • by Rob Y. (110975)

            Yeah, I was afraid of that.

            How about applying 'unreasonable seizure' to collecting royalties or removing a 'potential infringer' from the market prior to determination of infringement?

            • by bye (87770)

              Yeah, I was afraid of that.

              How about applying 'unreasonable seizure' to collecting royalties or removing a 'potential infringer' from the market prior to determination of infringement?

              That's a reasonable observation but this would bring an end to almost all lawsuits in the US, not just patent suits: the fact that an attacked party must still pay legal costs (and has to do that for years at times), even if he wins the lawsuit, is a form of unreasonable seizure in itself.

              The judicial system is not about fairness, it's about applying the rule of law. If you want our laws to represent (your version of) fairness, talk to your fellow citizens and make sure that the congressman you elect repres

    • Apple's OS and Apps use XML out the wazzu. this could be interesting.

    • This case was about the best case for software patents... Don't fool yourself, Microsoft KNEW UP FRONT what this product was, that it was patented, and actively hijacked their customers while being a "partner" with them. This was a "slam dunk" patent case which is why the court took it.

      Just like when Lessing was trying to overturn retroactive copyright, the court put the rules squarely on CONGRESS to fix... They seem to be truly living up conservative and refuse to legislate from the bench.

  • So you got this weapon you are using against others and now others are using it against you too! Cry me a river Microsoft. You helped to create the problem. Want to save yourself? Help uncreate it.

    • Congratulations, you've simplified a complex situation down to a simple black and white dichotomy which bears little relevance to the original situation. Have you considered founding a popular religion?

      • by erroneus (253617)

        Call me a religious fanatic, but I think it really is that simple. Get rid of software patents. We have already seen an effective death of "business method" patents after all.

        The situation isn't that complex. As it stands, you probably can't write a program in BASIC without violating some software patent either directly or by calling a routine or function within the BASIC interpreter. Didn't Microsoft patent a math function a few years ago? Some sort of increment/decrement function I think it was. Sof

    • by sgt scrub (869860)

      Agreed. I like the response that basically says, "our patents should be allowed to screw people but not anyone else's".

  • It's Patent Number: US007251778

  • by Greyfox (87712) on Thursday June 09, 2011 @11:31AM (#36389686) Homepage Journal
    "While the outcome is not what we had hoped for, we will continue to advocate for changes to the law that will prevent abuse of the patent system and protect inventors who hold patents representing true innovation,' Microsoft said in a statement.""

    If you run that statement through Google translate and select "English to Microsoftese", it translates it to "We'll continue to lobby for laws that allow us to file patent lawsuits against everyone else, but which prevents anyone else from filing them against us."

  • RTFO (Score:5, Interesting)

    by spiritu (8757) on Thursday June 09, 2011 @11:48AM (#36389942)

    I realize that this is Slashdot, &tc... but please read the full opinion. As it makes clear, the Supreme Court (in an 8-0 decision, with the Chief recused) agrees that this aspect of the patent system is broken. As it also makes clear, the responsibility for fixing the broken patent system lies entirely with Congress.

    This opinion is a good example of the Supreme Court essentially telling Congress to get its act together and fix the broken patent system. In the meantime, the Court reiterates what the problem is with the patent system in this case, and provides a solution for Congress to implement. But the Court is not empowered to fix the broken statute by itself, so it has to essentially settle for restating what the current broken statute says, and enforcing the law that's on the books.

    Since the broken statute is not unconstitutional - Congress was empowered by the Constitution to act, and it did, poorly - the Court can only point out the flaw and hope the Congress fixes it.

    • Bummer (Score:5, Insightful)

      by ThatsNotPudding (1045640) on Thursday June 09, 2011 @12:15PM (#36390452)

      As it also makes clear, the responsibility for fixing the broken patent system lies entirely with Congress.

      Well, then we are truly and fully fucked.

      • Re:Bummer (Score:5, Insightful)

        by adamchou (993073) on Thursday June 09, 2011 @01:28PM (#36391656)
        On the contrary, maybe this is a good thing. Its good that it happened to the 800 lb gorilla Microsoft instead of the little companies that can't afford to do anything about it. Microsoft has the money and political clout to lobby congress into getting something like this fixed. The little software companies would be rendered completely ineffective at trying to change something. I just hopes this means Microsoft is going to get this fixed
        • by Fjandr (66656)

          Microsoft has the money and political clout to lobby congress into getting something like this changed to their advantage.

          That's how lobbying works. Things aren't fixed, they're re-broken in such a way to further enrich those organizations who are able to buy politicians.

    • by DrJimbo (594231)

      This is why I think their ruling is total BS. It was the COURTS not Congress that made patent law so lopsided. Why can't the court clean up the mess they themselves created?

      Even if we grant their premise that it was acts of Congress that made patent law such an impediment to progress, the Court could still remedy the situation by declaring those laws unconstitutional since they clearly violate Article I, Section 8, Clause 8:

      To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.

      The sorry fact is that this is not about right or wrong, legal or illegal, c

    • I realize that this is Slashdot, &tc... but please read the full opinion. As it makes clear, the Supreme Court (in an 8-0 decision, with the Chief recused) agrees that this aspect of the patent system is broken. As it also makes clear, the responsibility for fixing the broken patent system lies entirely with Congress.

      This opinion is a good example of the Supreme Court essentially telling Congress to get its act together and fix the broken patent system. In the meantime, the Court reiterates what the problem is with the patent system in this case, and provides a solution for Congress to implement. But the Court is not empowered to fix the broken statute by itself, so it has to essentially settle for restating what the current broken statute says, and enforcing the law that's on the books.

      Since the broken statute is not unconstitutional - Congress was empowered by the Constitution to act, and it did, poorly - the Court can only point out the flaw and hope the Congress fixes it.

      Not really. The Supreme Court were the ones who first came up with this interpretation, in a decision back in 1934. It was then applied for 20 years until Congress thought it was such a good idea that they expressly put it into the statute. It's been statutory law for the past 60 years.
      So to say the Supreme Court is now saying "yeah, the statute, which comes from a decision we had 80 years ago which we're currently affirming, is totally wrong and broken" is just incorrect.

    • by nyri (132206)

      I realize that this is Slashdot, &tc... but please read the full opinion. As it makes clear, the Supreme Court (in an 8-0 decision, with the Chief recused) agrees that this aspect of the patent system is broken.

      You can find it here: http://www.law.cornell.edu/supct/html/10-290.ZS.html [cornell.edu]

      This opinion is a good example of the Supreme Court essentially telling Congress to get its act together and fix the broken patent system. In the meantime, the Court reiterates what the problem is with the patent system in this case, and provides a solution for Congress to implement. But the Court is not empowered to fix the broken statute by itself, so it has to essentially settle for restating what the current broken statute says, and enforcing the law that's on the books.

      Well there is more to it. I find this concurrence by Breyer interesting. It gives a layman such as myself a clear picture what they ruled:

      I join the Court’s opinion in full. I write separately because, given the technical but important nature of the invalidity question, I believe it worth emphasizing that in this area of law as in others the evidentiary standard of proof applies to questions of fact and not to questions of law.

    • by petsounds (593538)

      Here's the passage in question, for those too lazy to look at the FPDF:

      c) This Court is in no position to judge the comparative force of the parties’ policy arguments as to the wisdom of the clear-and- convincing-evidence standard that Congress adopted. Congress specified the applicable standard of proof in 1952 when it codified the common-law presumption of patent validity. During the nearly 30 years that the Federal Circuit has interpreted 282 as the Court does today, Congress has often amended 282

  • Maybe now MS will refocus their considerable lobbying resources to true patent reform since they've now been bitten hard by the current broken system.

  • to what they do best: intimating Linux infringes on their patent troll portfolio.
  • by Julie188 (991243) on Thursday June 09, 2011 @12:50PM (#36391000)
    As part of the commentary in the ruling, Justice Breyer offered some advice to courts on how they can use facts in court cases about patent infringement. Some patent lawyers think that this may make it easier for juries to overturn a patent. (More in my article here, if you're interested: http://www.networkworld.com/news/2011/060911-microsoft-i4i-patent.html [networkworld.com]) It's not the same as a ruling that would make it easier for companies to defend against patent infringement suits from bad patents, or if the Bilski case had lead to invalidated "business process" patents altogether ... Yes, the Supreme Court is making it clear that this is up to Congress to fix ... which it really is. But gimme a break ... Members of Congress are a little busy right now arguing over gutting Medicare and scandals involving naughty Twitpics.

    Julie
  • They're sitting there making money form HTC off Android phones and have done nothing to deserve it. TBH, I think they deserve a bit more butt hurt over this to return the favour.
  • by Animats (122034) on Thursday June 09, 2011 @02:01PM (#36392156) Homepage

    This was a reasonable decision. Microsoft was willfully infringing, and their only defense was that some old version of the product which might have contained the patented technology might have been on sale a year before the patent was filed. Microsoft lost on that issue at trial. Microsoft then cooked up a legal theory that they only had to show a preponderance of the evidence to prevail, rather than having to overcome the statutory provision that issued patents are assumed valid. That was a a weak argument; both the plain text of the statute and previous decisions are against it. The Supreme Court slapped it down 8-0. I'm surprised the Court even took the case.

    This isn't a major decision in patent law, like Bilski or Zoltek. It doesn't change policy. Read "Microsoft v. i4i: Supreme Court Affirms Strong Presumption of Patent Validity " [patentlyo.com] on PatentlyO.

  • A name like i4i is inviting Microsoft to take an eye for an eye and sue them right back.

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