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Microsoft Might Get Advantage or Pain from Order To Not Sell Word

A federal court panel upheld the $290 million patent infringement judgment against Microsoft, as well as the permanent injunction against selling Word, that i4i had won in a lower court. Given the size of the award, you might anticipate that Microsoft will head to further rounds of appeals. But you have to wonder whether Microsoft might see silver in those clouds, and whether the results could throw a monkey wrench into plans that Google and others have to compete with Office.

The infringement suit was over a patent that i4i holds on handling XML metadata in files separately from the data in the files themselves. Specifically, the courts have read this is covering files with custom XML code. In August, i4i got its request for a permanent injunction prohibiting Microsoft from selling versions of Word that infringed on the patent.

Microsoft appealed the ruling and got a temporary stay of the injunction. Now that this round of appeals is over, the date for the start of the injunction is now January 11, 2010. Its "scope is narrow," according to the decision:

It applies only to users who purchase or license Word after the date the injunction takes effect. Users who purchase or license Word before the injunction's effective date may continue using Word's custom XML editor, and receiving technical support.
It's not as though Microsoft's legal handling has been faultless. As the decision indicates, for example, the company waived its right to challenge a number of things by not raising certain challenges early enough in the process. But it still has some options and, given the amount of the judgment, it seems reasonable that it will appeal again, first to a so-called en banc hearing of the entire Court of Appeals for the Federal Circuit (the appeals court that hears patent cases) and, should that go against it, the Supreme Court.

Microsoft is saying that it could come up with a technical workaround, but make no mistake, should the injunction go into force, there are some big issues. As the decision notes, here's what Microsoft would not be able to do under the injunction:

  1. "selling, offering to sell, and/or importing into the United States any infringing Word products with the capability of opening XML files containing custom XML"
  2. "using Word to open an XML file containing custom XML"
  3. "instructing or encouraging anyone to use Word to open an XML containing custom XML"
  4. providing support or assistance that describes how to use Word to open an XML file containing custom XML"
  5. "testing, demonstrating, or marketing Word's ability to open an XML file containing custom XML"
So why does this interest Google? Because the company wants to woo corporate customers away from Microsoft Office, which is why it is acquiring DocVerse, a service that allows collaborative sharing of Office documents. But all that is based on the existing versions of the files, including the versions of Word that infringe on the patent. If DocVerse, run by a couple of ex-Microsoft people, used a similar approach in opening Word files, then they're will have as much need to disable those particular functions as would Microsoft, or else face a potential patent infringement suit. The question facing all of them is how easy might it be to find another way to open files with custom XML? And just what is custom XML? According to something found by Mary Jo Foley at ZDNet, it's XML used to identify parts of a document by business semantics, like "this phrase is the ship to address for the customer." By using a w:customXML tag, the user can define the tag and let others see what is happening in the document. Somehow, I think that would be pretty important for collaboration, which is a potentially big weapon for Google to compete in the office application space.

is something that my former colleague Michael Hickins mentioned back in August:

Microsoft could agree to license custom XML from i4i with the understanding that i4i will also enforce its patent against other vendors using custom XML, which would both allow Microsoft to continue using its applications as written while wounding its competition (with the added benefit of looking innocent).
Right now that doesn't seem to be in the cards. But as things go on and pressure mounts, it may change its tune ... assuming that i4i was interested in a deal. Then again, there is another possibility: Google could buy i4i and then turn around and stick it to Microsoft.

Gavel image via Flickr user Thomas Roche, CC 2.0.

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