Court Enjoins Sales of Microsoft Word, OKs $277 Million Award

Microsoft Corp. has two months to stop selling its Word software because it infringes another company's patent, a Texas federal judge has ruled, approving damages and interest totaling more than $277 million.

At the same time, U.S. District Judge Leonard Davis rejected Microsoft's motions for a new trial and judgment as a matter of law after a jury determined the technology giant must pay $200 million in damages for willfully infringing a patent owned by a Canadian company. The judge tacked on $77 million in enhanced damages to the award.

Plaintiff i4i L.P. sued Microsoft in the U.S. District Court for the Eastern District of Texas, alleging the Word software infringes its patent on a method that allows computers to manipulate, process and interpret text.

Microsoft maintained that its Word 2003 and Word 2007 software is non-infringing and that i4i's patent was invalid.

The jury disagreed and found in i4i's favor after a seven-day trial held in May.

Microsoft sought a new trial or, in the alternative, judgment as a matter of law.

Judge Davis rejected both motions, finding that i4i presented legally sufficient evidence to substantiate its claims and that Microsoft's assertions merely expressed disagreement with the jury's verdict.

The judge rejected Microsoft's motion for reduction of the damages and instead enhanced the jury's award by $40 million after concluding that defense counsel repeatedly made improper arguments before the jury even after warnings from the bench.

In addition i4i was awarded an additional $37 million in prejudgment interest.

Finally, Judge Davis issued an injunction barring Microsoft from selling any versions of Word that use i4i's patented technology. The injunction will take effect 60 days from the Aug. 11 order.

Industry experts say the injunction likely will not hurt Microsoft because it easily can adjust its programs to comply with the ruling, according to a Reuters report.

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