Earlier this month, the Honorable Leonard Davis of the United States District Court for the Eastern District of Texas made a determination of willful patent infringement in favor of a thirty (30) employee Canadian based software manufacture who sued the software giant, Microsoft.  The lawsuit filed by Infrastructures for Information Inc., known as i4i claimed that MS Word 2003 and 2007 included an Extensible Markup Language or XLM tagging feature that infringed its patent.  The plot was thickened by the fact that i4i developed a product based on the patent and even negotiated the possibility of a license with Microsoft which triggered allegations of willful infringement on the part of the software giant who is no stranger to litigation.  

Specifically, in May of this year, the jury found in favor of i4i and awarded it $200 million.  But earlier this month, Judge Davis found that the infringement was willful and added $40 million to the damages award along with pre-judgment interest in the amount of $37 million.  He then issued a permanent injunction prohibiting Microsoft from selling MS Word in the US and giving Microsoft 60 days to comply with the injunction. 

Initially, word of the injunction lead to much speculation about Microsoft’s ability to develop a patch for the software that disabled the custom XLM and roll it out in an update for MS Word within the 60 days compliance period.  Therefore, no one was surprised when Microsoft appealed the ruling and sought an expedited hearing claiming that compliance with the injunction would irreparably harm the company. Now with a hearing set for September 23 before the Federal Court of Appeals rumor has it that Microsoft, who has vowed to invalidate the patent, is talking settlement.  Till then, many will be anxiously awaiting the software giant’s irreparable harm arguments.