Toronto firm i4i prevails in patent infringement suit against Microsoft Word
As has been widely covered in the traditional media and on technology blogs, last month, the Supreme Court of the United States released a unanimous opinion holding that Microsoft had infringed i4i’s valid patent.
The i4i patent claims an improved method for editing computer documents, which stores a document’s content separately from the metacodes associated with the document’s structure. In 2007, i4i sued Microsoft for willful infringement, claiming that Microsoft’s manufacture and sale of certain Microsoft Word products infringed i4i’s patent.
Microsoft had claimed that the on-sale bar of §102(b) rendered the patent invalid, pointing to i4i’s prior sale of a software program known as S4.
The burden to invalidate a patent
Microsoft argued the jury should not have been instructed to look for “clear and convincing” evidence of the prior sale of the S4 program. At trial, the jury heard that the S4 source code had been destroyed years before the commencement of this litigation, and therefore the factual dispute turned largely on trial testimony by S4’s two inventors—also the named inventors on the i4i patent—both of whom testified that S4 did not practice the key invention disclosed in the patent.
Microsoft argued that a lower standard of proof should have applied to invalidate the i4i patent, based on a mere “preponderance of the evidence”. Microsoft also argued that this lower standard of proof should apply where the alleged prior art was not presented to the Patent Office during the pre-grant examination process (as was the case with the S4 program).
SCOTUS opinion strengthens patents
Section 282 of the Patent Act states that a patent is “presumed valid” and the “burden of establishing invalidity… rests on the party asserting such invalidity”.
Justice Sotomayor, writing for a majority of the Court, held that Congress had enacted this section using language that had a settled meaning at common law, namely, that “there is a presumption of [patent] validity [that is] not to be overthrown except by clear and cogent evidence” (Radio Corp. of America v. Radio Engineering Laboratories, Inc., 293 U. S. 1 (RCA)). She analyzed other interpretive theories advanced by Microsoft, all of which were not persuasive and dismissed.
As to the issue of the prior art not being before the factfinder during the patent examination process, Justice Sotomayor held that a “fluctuating” standard of proof was not appropriate, rehearsing the same statutory interpretation analysis based on section 282 and RCA.
In the end, the Court decided that the jury instruction was correct, and that the i4i patent enjoys a presumption of validity that could only be displaced by “clear and convincing” evidence. Justice Sotomayor concluded the majority opinion by stating, “any recalibration of the standard of proof remains in Congress’ hands”.
Microsoft has exhausted all appeals, and will now have to pay the jury’s $290M damages award to Toronto-based i4i.
The case is Microsoft Corp. v. i4i Limited Partnership et al., 564 U.S. ___ (2011), Decided June 9, 2011.
A link to all the court documents is maintained by i4i here.
