Supreme Court showdown for Microsoft and patent law
Maggie Shiels | 09:06 UK time, Monday, 18 April 2011
US patent law will be put in the dock later today (18 April) when the highest court in the land considers a case brought by the world's biggest software company, Microsoft.
But at stake is more than just the $290m (£180m) judgement that a small Canadian firm, i4i, secured against Microsoft for patent infringement.
Legal experts have said that the outcome of the US Supreme Court hearing will decide how patent laws protect exclusive technology and impact innovation.
Critics have said what concerns them most is that a win for Microsoft would significantly weaken important patent protections that allow inventors to profit from their creations.
Back in 2007, i4i took the world's biggest software company to court because its popular Word programme, used by about 500 million people, infringed a patent it was granted in 1998. The alleged infringement was related to document editing.
As well as the $290m judgement, i4i also obtained an injunction that barred sales of certain versions of Word that infringed the patent.
Microsoft's claim that the disputed patent was invalid because the i4i invention was based on technology that was already in the marketplace did not persuade the lower courts or a federal appeals court to rule in its favour.
Last August Microsoft turned to the Supreme Court and later today it will consider whether or not to change the way patent law is litigated.
Microsoft has said the federal appeals court that handles patent cases is making it too hard for those accused of infringement to argue that a patent never should have been issued and is invalid.
The Supreme Court is being asked to decide the degree to which juries should be allowed to question whether a patent should have been granted at all.
In an op-ed piece for the New York Times, Doug Lichtman, a professor of law at the University of California, Los Angeles, has written that this is a "critical issue":
"The current approach, under which juries are explicitly discouraged from questioning a patent's validity, all too often means that dubious patents are nevertheless enforced. That inhibits innovation, the very thing that patent law is supposed to encourage," said Mr Lichtman.
According to i4i's chairman Loudon Owen, the case is "a turning point in patent law":
"The patent you're granted has very little meaning if it's not enforceable. Why have a patent if it's useless?" he told the Canadian Press.
"When you get a patent, you put your heart and soul into the invention, you work tremendously hard and you spend a lot of money. But if all of a sudden it becomes apparent to everybody that the patent itself is worthless, why do it?"
Microsoft has argued that bad patents are the worst of all worlds:
"Innovation is one of the great drivers, one of the bright spots of our economy," said Andy Culbert, associate general counsel for Microsoft. "If you have a really bad patent that shouldn't have been issued, what happens? It stops innovation."
Some heavy hitters have lined up on both sides of the argument.
On i4i's side are the likes of General Electric, Johnson & Johnson, 3M, Procter and Gamble, and BP. In a brief to the court the companies said: "Inventors and society would suffer from such a rule, which would simultaneously reduce the rewards of innovation by weakening property rights while increasing the costs of innovation."
On Microsoft's side are Google, Verizon, Apple, Intel, HP and Yahoo who have said the patent system "is tilting out of balance", giving disproportionate power to people who secure patents of questionable legitimacy.
The $290m award won by i4i, which totals just 30 people, stands as the largest ever upheld by an appeals court in a patent case.
The Supreme Court verdict is expected in the summer, bringing to an end a four year long David versus Goliath fight, with serious consequences for patent law and innovation.
Credit: BBC (www.bbc.co.uk)
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