More on Toronto-based i4i vs Microsoft

Microsoft won a temporary reprieve against an injunction that prohibited it from selling Word in the US as a result of a protracted patent infringement battle against Toronto-based i4i. The stakes are very high here, as Office alone brings in north of $10 billion annually for Microsoft.

i4i had alleged in its lawsuit that MS Word 2003 and later versions included its proprietary technology on custom processing of XML. The jury sided with i4i and granted it $200 million in damages earlier in the summer; the judge then added on another $40 million for ‘misconduct’ by a Microsoft attorney during the proceedings; and finally issued an injunction against the sales of Word in the US. Microsoft has been supported by Dell and HP in court in laying out its case that an injunction against Word would have far reaching implications for the entire industry, and is also seeking to buy more time from the courts to enable it to re-design Word around i4i’s technology claims.

Sept 23rd is the D-Day in this case – when the Federal Court of Appeals will hear the Microsoft appeal. Loudon Owen, Chairman of i4i, seems confident about it:

“To paraphrase the great heavyweight boxing champion Joe Louis, ‘they can run, but they can’t hide’. Microsoft’s time will eventually run out.”

Somewhere in Redmond, i4i probably has a big red circle around it right now – would be interesting to see how this ends. Most likely scenario seems to be a massive windfall for i4i and its backers as part of an eventual settlement with Microsoft. Its surprising that the case even got to trial by jury…wondering why didn’t Microsoft settle earlier and risked an injunction on its key cash cow ?