XML patent: US Supreme Court upholds decision against Microsoft

In the legal battle about an XML patent, Microsoft has suffered a final defeat in its appeal at the US Supreme Court. The US Supreme Court rejected Microsoft's appeal and upheld the ruling against Microsoft, in a decision published in Washington on Thursday.

Microsoft's appeal had been supported by, among others, a number of free software and open source advocacy groups including the EFF, Public Knowledge, the Apache Software Foundation, and companies such as Apple, Yahoo, Google, Facebook, Dell, HP and Intel. They had hoped that a ruling in Microsoft's favour would rebalance the patent system.

In the dispute about an XML formatting method in documents, Microsoft had, in May 2009, been found guilty of having infringed Canadian software vendor i4i's patent number 5,787,449 in its Word word processing program. The first instance ruling had forbidden the further use of the technology by Microsoft, imposed a sales ban on Word, and determined damages amounting to $290 million.

Microsoft had responded by releasing modified versions of Word to bypass the sales ban. An appeal by the company was rejected, and an attempt to start a new trial was also rejected by the court of appeals. Microsoft's only remaining option was to appeal to the US Supreme Court, where the case was accepted in November 2010.

In its complaint, Microsoft had claimed that the patent held by i4i is invalid. To invalidate an existing patent, "clear and convincing" evidence is required by US law. Lower courts had ruled that Microsoft had been unable to provide such evidence. The software company argued that the legal requirements for proving the invalidity of a patent are too strict and demanded that the standard of proof applied by the court be substantially lowered.

This has given the case a relevance that reaches far beyond the disputed patent. The US Supreme Court had to decide on the criteria required to invalidate a patent granted by the US Patent Office. Although Microsoft could count on broad support from companies and industry associations, the US government didn't want to see the standard watered down and advocated that the appeal decision be upheld by the court.

The justices unanimously upheld the existing standard. The case carried explosive political implications, and it seems that the Supreme Court judges didn't want to light the fuse. The court wrote that US Congress specified the applicable standard of proof in 1952, and that it has never considered any proposal to lower the standard although the associated law has often been amended. "Accordingly, any recalibration of the standard of proof remains in Congress’ hands", said the judges.

(djwm)