Microsoft Anti-piracy Technology is Patent Infringement

Microsoft anti-piracy

Some court rulings are just rich with irony. Today, April 8, a jury found that Microsoft infringed on Uniloc patents for product activation. Microsoft uses the technology to protect its software from theft. Who's stealing from whom?

Today's jury verdict, ordered Microsoft to pay Uniloc $388 million. Gauging from rants about product activation, many people don't like it.

The case could be an episode of some TV legal drama. Uniloc filed the patent dispute in late Sept. 2003. About three years later, U.S. District Judge William Smith issued summary judgment for Microsoft, which Uniloc appealed. In August 2008, the U.S. Court of Appeals for the Federal Circuit sent the case back to trial, overruling the judge.

How's this for drama? According to court documents:

The district judge indicated that he was inclined to appoint an independent expert or special master to assist in deciding the motions given the complicated subject matter of this dispute. Ultimately, the district court hired an evening law student who was finishing his Ph.D. in computer science as an unpaid judicial intern to work on the case. Uniloc objected to the intern's involvement with the case, alleging that the intern had numerous ties to Microsoft.

The so-called expert advising for the court had ties to Microsoft. The lower court essentially dismissed the case in Microsoft's favor, claiming that for infringement there must be identical algorithms used on client and server systems, which Uniloc failed to prove. The appellate court disagreed, in part because of statements made by Microsoft and Uniloc's narrower scope of infringement. But the appellate court didn't remove Judge Smith, as Uniloc had requested.

In dispute: U.S. Patent No. 5,490,216. The appeals court ruling explains:

The '216 patent is directed to a software registration system wherein a particular piece of software may run on a platform in use mode if and only if a specified licensing procedure has taken place... Uniloc sued Microsoft, alleging that Microsoft's Product Activation system, an anti-piracy registration system used to reduce unlicensed use of its software products, infringed sixteen claims of the '216 patent under eight different infringement theories over twenty-four different disputed claim terms.

Today's jury verdict is bigger trouble for Microsoft than might initially appear, because the award covers product activation outside the United States—$194 million of the award (MarketWatch reported the $194 million figure, based on court documents, which I haven't yet seen). The Patent Act, or Title 35 of the United States Code, governs U.S. patents and generally protects U.S. companies from international infringement. Uniloc has offices in California and Singapore.

The jury applied the $388 million back to Oct. 1, 2003, around the time of the case's filing. Microsoft can ask the court to dismiss the verdict, and there is an option to appeal. But none of that avoids the irony of Microsoft being found guilty of stealing, so to speak, technology meant to prevent people from stealing its software.

via Microsoft Watch - Corporate - Microsoft Anti-piracy Technology Is Patent Infringement.