Microsoft loses its appeal in $200-million-plus Custom XML patent infringement case

Microsoft loses its appeal in $200-million-plus Custom XML patent infringement case

Summary: Microsoft is going to have to cease providing Custom XML as part of its Office suite, as it has lost its appeal to overturn a patent-infringement verdict awarded to Toronto-based i4i for that technology.

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Microsoft is going to have to cease providing Custom XML as part of its Office suite, as it has lost its appeal to overturn a patent-infringement verdict awarded to Toronto-based i4i for that technology.

The plaintiffs were seeking $200 million for patent infringement. The Federal Circuit Court of Appeals is awarding i4i more than $290 million, plus an added $40 million for intentional infringement, according to a Bloomberg report about the December 22 court verdict. Microsoft has until January 11 to remove the cease selling copies of Office which include Custom XML functionality -- a date which is five months after the original late August 2009 ruling date, the Bloomberg report said.

According to what I had heard previously, Microsoft already has figured a way to disable the Custom XML feature and could address the court order via a release of a Word 2007 version with a patch that will disable that functionality. I'd assume the same fix will be applied to Office 2010 between now and its final release by June 2010. See Microsoft response below: Officials say Custom XML isn't in the Office 2010 beta and that they only have to remove the offending technology from copies of Word 2007 and Office 2007 that are sold on or after January 11.

According to Microsoft, Custom XML is the support for custom-defined schemas. It enables integration of documents with business processes and business data.

I've asked Microsoft for further information about what the company is planning, as a result of today's ruling. I'll add an update to this post once I hear back.

Update 1: Here's Microsoft's official response regarding today's loss of its appeal from spokesperson Kevin Kutz:

"This injunction applies only to copies of Microsoft Word 2007 and Microsoft Office 2007 sold in the U.S. on or after the injunction date of January 11, 2010.  Copies of these products sold before this date are not affected.

"With respect to Microsoft Word 2007 and Microsoft Office 2007, we have been preparing for this possibility since the District Court issued its injunction in August 2009 and have put the wheels in motion to remove this little-used feature from these products.   Therefore, we expect to have copies of Microsoft Word 2007 and Office 2007, with this feature removed, available for U.S. sale and distribution by the injunction date.  In addition, the beta versions of Microsoft Word 2010 and Microsoft Office 2010, which are available now for downloading, do not contain the technology covered by the injunction.

"While we are moving quickly to address the injunction issue, we are also considering our legal options, which could include a request for a rehearing by the Federal Circuit Court of Appeals en banc or a request for a writ of certiorari from the U.S. Supreme Court. "

Update 2: Thanks to Reader "Bitzie," we now know .Microsoft already has released a patch that disables Custom XML In fact, it looks like this patch went to OEMs in October 2009.

The "supplemental" release for Office 2007 in the U.S. includes a patch, that once, installed, makes sure "Word will no longer read the Custom XML elements contained within DOCX, DOCM, or XML files. These files will continue to open, but any Custom XML elements will be removed. The ability to handle custom XML markup is typically used in association with automated server based processing of Word documents. Custom XML is not typically used by most end users of Word."

Topics: Microsoft, Collaboration, Software

About

Mary Jo has covered the tech industry for 30 years for a variety of publications and Web sites, and is a frequent guest on radio, TV and podcasts, speaking about all things Microsoft-related. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008).

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190 comments
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  • Just when it might have been thought that...

    There was no special treat for Christmas, the courts duly serve up this little gem.

    Mebbe Microsoft might have to resolve for the new year, "Guys, let's not steal others' IP from here on in, ok?"
    zkiwi
    • Or maybe...

      Or maybe the we'll get back to the notion that a frankly obvious idea is not some property that can be owned by a single corporate entity.
      njoho
      • One man's obvious is another man's "Huh?"

        That being said, the case history shows that Microsoft knew of the product, knew of its being patented, and still infringed anyway.

        Now, regardless of the rights or wrongs of software patents, that's just plain lame/wrong/illegal behaviour on the part of Microsoft.
        zkiwi
        • Be careful, this is bad for all...

          as OOo and ODF violate the same patents. As does CSS. This is a really stupid patent and being happy MS lost this is about the only thing that tops it in stupidity.
          LiquidLearner
          • No, it isn't...

            If Microsoft (and others) truly thought that this patent was invalid they have had plenty of time and opportunity to get it revoked.

            This case has been around for a not inconsiderable time, and as I have stated, Microsoft knew of the patent, knew they were infringing and infringed anyway. That is wrong.

            Oh, and i4i have (I believe) stated that they believe that ODF does not infringe on their patent

            And don't try to excuse it on a "patents are bad" or "but there's a bigger picture" stupidity. If Microsoft (and others) thought patents were a bad thing, they've got/had the time and the money to get that part of the system changed. However, they haven't, and won't.
            zkiwi
          • your biased

            Im just trying to use common sense.

            ...To help innovation and to not stiffle it with multimillion dollar lawsuits.

            Prove to us that an xml reader of any sort is groundbreaking.

            sounds like a basic file reader, and "tech" thats been around since the dawn of modern computing. hardly worth patenting.

            greping a file and displaying the results can pay 200 million? niiiiiice !!!!

            if it was a sat nav system engineering and utilizing gps convergence data with a multitute of carrier waves and their.. etc etc... maybe we would all understand that sort of lawsuit (you get the idea here)

            but then again...
            pcguy777
          • Common sense however...

            Would have looked at the case and said, "Hmmm, Microsoft knew of the product, knew it was patented. Didn't move to have the patent invalidated before it hijacked the product. Proceeded to release the hijacked code despite knowing that in doing so they would be in breach of the law." Then using common sense you'd have to conclude, "Dude, Microsoft (in this case) absolutely sucks!"
            zkiwi
          • Common Sense?

            For one, common sense is not so common anymore. But to the point, if you believe that you can take someone's rights away because you don't feel it's " ground breaking ", you are living in the wrong country. We have rights that others can't take away just because they don't agree. A patent is a legal right, no matter how stupid it may be.
            MachineMan1
          • Nope. Software patents are bad

            The tech industry was doing just fine until software patents were "enforced" thanks to the State Street decision.

            When Bilski goes down in flames though, at least some of the really bad patent processing efforts will go away instantly.
            DonRupertBitByte
          • I agree, but...

            The fact remains that MS apparently knew they were infringing. Considering they hold patents themselves and enforce them, they have to be held to the same standards.

            Someone who is part of the system and benefits from it can't really complain when it comes back to bite them.
            mdsock@...
          • Not to nit pick...

            and if MS was in violation of a patent, especially knowingly, then sure they should be sued. I misunderstood the patent it seems so after doing a bit more research than yes, this seems just.

            However please point me to one article where MS "enforced" a patent. They've threatened to take legal action but they've never actually done it.
            LiquidLearner
          • OOXML, ODF and custom XML

            Hi. In spite of the "XML" in the name, this patent doesn't have any connection with OOXML. I've seen some folks try to say that this invalidates or jeopardizes OOXML but this is not the case. I asked MS for a statement about whether this case affects/involves OOXML in any way and got this back from a spokesman, fwiw:

            "The decision has no implications for Open XML. There was no claim by the patent or its holder that it is essential to the Open XML standard."

            Thanks. MJ
            Mary Jo Foley
          • Thanks for clearing that up

            I remember first reading about this when the initial injunction was reached and the patent read like it included the document format itself. My mistake.
            LiquidLearner
        • re: One man's obvious is another man's "Huh?"

          [i]Microsoft knew of the product, knew of its being patented, and still infringed anyway.[/i]

          Which makes MS liable for treble damages. MS got off easy with only a $40M fine for willful infringement.






          :)
          none none
          • Criminal

            You would fine MSFT $40 billion if you could.
            MSFTWorshipper
          • If the crime fits...

            Why not fine them, or whoever is as guilty as they are that much? Or are you one who thinks that criminals should be given a free pass?
            zkiwi
        • true

          Especially when you consider MS can't cry poverty. They could well afford to license this feature.
          Al_nyc
        • I don't agree...

          The patent office regularly issues invalid patents for trivial or "obvious" inventions. Unfortunately, judges tend to side with the patent holder, rather than striking down the patent.

          Perhaps /the/ classic example of an invalid patent is the one for an intermittent windshield wiper that its inventor eventually got a huge settlement from Ford or GM (I forget which).
          GrizzledGeezer
          • So you're advocating ignoring patents because you...

            think they're invalid. That's not a particularly useful approach to life imho.
            zkiwi
        • SO TYPICAL of MSucks!

          Isn't this really MSucks life story? Since the days of DOS 3.1 they have used this same practice. Every new release has incorporated someone else's code. In the past it appears that when the company had enough money to bring suit against MSucks, they just bought the company. But for thousands of little guys, they just got screwed and lost their income for the utility they had come up with. Oh, think back! Gates didn't even think up DOS. It was given to him for a song. GUI, given to him by Xerox. MS doesn't really do one heck of alot, but STEAL other peoples ideas and incorporate them into their product. Not very well if you ask me. We should be getting Win7 as a bug fix for every other piece of crap OS release so far.
          sfaid