Microsoft wins reversal of MP3-patent decision

07 Aug 2007 11:48

Company will not have to pay Alcatel-Lucent $1.52m, after a judge ruled that it had not infringed one of two patents at issue for MP3 tech

Microsoft has won a reversal of a $1.52bn (£749m) jury verdict against it for infringing on a patent for MP3 technology held by Alcatel-Lucent.

The judge of a California district court threw out the damages after finding that a jury improperly ruled that Microsoft infringed one of two patents at issue for MP3 technology.

The new ruling holds that one of the patents in the case was not actually owned outright by Lucent and, since Microsoft had a licence to that particular patent through its co-owner, the software giant is being let off the hook.

The judge ruled on Friday that the patent was co-owned by AT&T, Lucent's former parent company, and a German company called Fraunhofer, with which Microsoft had a licensing agreement to use the patented technology.

This is the opposite of what a jury concluded in February, but the judge on Friday ruled that some of the technology in the patent was developed after Fraunhofer and AT&T signed a joint-development agreement in 1989.

That would give Fraunhofer co-ownership rights to the patent (known as the '080 patent), and the right to license it to Microsoft. Furthermore, it doesn't allow Lucent-Alcatel to sue Microsoft for infringement because Fraunhofer wasn't included in the original suit, the judge ruled.

"Today's ruling by the judge reversing the jury's $1.52bn verdict against Microsoft is a victory for consumers of digital music and a triumph for common sense in the patent system. For the hundreds of companies, large and small, that rely on MP3 technology, the court's ruling clarifies that these companies have properly licensed the technology embodied in the '080 patent from its co-owner and industry recognised MP3 licensor, Fraunhofer," Microsoft said in a statement.

Alcatel-Lucent was less happy. "The reversal of the judge's own pre-trial and post-trial rulings is shocking and disturbing," a spokeswoman told Bloomberg. "The jury unanimously agreed with us. We believe their decision should stand."

Alcatel-Lucent may appeal the decision.

Story URL: http://news.zdnet.co.uk/software/0,1000000121,39288445,00.htm