RI judge tosses patent verdict against Microsoft

September 30, 2009 By JESSICA MINTZ , AP Technology Writer

(AP) -- A federal judge in Rhode Island threw out a $388 million patent infringement jury verdict against Microsoft Corp., the latest move in a six-year legal skirmish.

In April, a jury found that the world's largest software maker had infringed on a patent owned by Uniloc Inc.

Irvine, Calif.-based Uniloc makes software that prevents people from illegally installing software on multiple computers. Uniloc had argued Microsoft's "product activation" system used in Windows XP, Office XP and Office 2003 programs infringed on several parts of a related patent, and that the software maker had copied Uniloc's technology rather than developed similar work on its own.

Uniloc's original lawsuit was filed in U.S. District Court in Rhode Island in 2003. Microsoft won summary judgment in 2007, and Uniloc appealed. The U.S. Court of Appeals for the Federal Circuit sent a much narrower version of the case back to district court, which ruled in Uniloc's favor earlier this year. Microsoft asked the judge to reconsider.

U.S. District Judge William Smith dismissed the jury verdict in a decision made public late Tuesday.

"The Court has reviewed the transcripts and evidence with painstaking detail in the light most favorable to Uniloc, careful not to act as the eleventh juror. What remains is a firm belief (indeed a certitude) that the jury 'lacked a grasp of the issues before it' and reached a finding without a legally sufficient basis," Smith wrote, finding once again that Microsoft did not infringe on the patent.

Smith also said the jury's method of deciding how much Microsoft owed Uniloc, based on total sales of Windows XP and Office, was flawed.

Uniloc said it plans to appeal the judge's latest decision.

"We believe that the jury's verdict in April was thoughtful, well reasoned and supported by the evidence presented," said Brad Davis, Uniloc's CEO, in a statement.

Microsoft, based in Redmond, Wash., said in a statement that is pleased with the outcome.

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