Texas court orders Microsoft to pay Toronto firm $200 million

A jury in Texas has ordered Microsoft to pay a Toronto software company US$200 million for patent infringement involving several of its software products.

Microsoft was ordered to pay Toronto-based i4i after an eight-day jury trial in a U.S. District Court for the Eastern District of Texas.

The Toronto firm creates collaborative authoring and document management software and specializes in XML -based content development.

“We clearly agree with the jury finding that there was infringement and wilfull infingement at that on the part of Microsoft,” Loudon Owen, one of i4i’s directors told ITWorldCanada late Thursday afternnon.

i4i’s Website states that the company “has assisted some of the most successful organizations, across a wide range of industries with their XML content development and management.”

Among the company’s list of clients are well-known pharmaceutical companies such as: Bayer, Bausch and Lamb Pharmaceuticals Inc, GenPharm Inc. Merc & Co. Inc., and Sandoz.

The company was founded by Michel Vulpe, a Montreal-born inventor whose client include U.S. Marine Corp, the State of Ohio and the National Aeronautics and Space Administration.

In 1994,Vulpe and Stephen Owens developed a solution that enabled people to use regular word processors as XML /SGML editors.

i4i originally filed the case in March 2007, claiming Microsoft willfully infringed on patented technology in Microsoft Office Word 2003, Word 2007, .NET Framework and Windows Vista software. i4i was issued the patent — U.S. Patent No. 5,787,499 — in 1998.

The technology that the court said infringes on the i4i patent enables custom XML tagging in Word 2003 and Word 2007, used mainly for people creating and modifying templates for Word documents.

i4i would not get into the details of how Microsoft’s products had infringed on the Toronto company’s technology but Mike Cannata, another i4i director said they will continue to vigorously protect their intellectual property.

In a statement, Microsoft said it is “disappointed” with the jury’s verdict and will appeal.

“We believe the evidence clearly demonstrated that we do not infringe and that the i4i patent is invalid,” the company said via e-mail. “We believe this award of damages is legally and factually unsupported, so we will ask the court to overturn the verdict.”

However in published reports, i4i President Karen Heater said the company felt “vindicated” about the verdict.

The ruling is the second patent ruling to go against Microsoft in as many months. In April Microsoft was ordered to pay $388 million to Uniloc, a company that makes antipiracy tools.

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