Court bans Microsoft Word in patent case, could impact sales

i4i Ltd, a small Canadian firm with only 30 employees, had accused Microsoft of infringing a patent related to Extensible Markup Language (XML) held by it.

In the ruling, the district judge Leonard Davis stated, “Microsoft had knowledge of the patent and its relation to i4i’s products and willfully chose to render the technology obsolete while simply ignoring the patent.”

The judgment applies to Word 2003 and Word 2007 as these versions enable users to open .XML, .DOCX, or .DOCM files that contain custom XML.

Significant achievement for i4i
While the decision dealt a blow to Microsoft, it marked a significant achievement for i4i.

Hailing the judgment as “a landmark decision”, Loudon Owen, i4i's chairman for the past 13 years, stated, “This is a Canadian entrepreneurial victory versus giant Microsoft in what is a highly strategic area of the IT industry."

The XML technology, a key constituent of many Web sites, and other programs, enables users to access any kind of computer file as a regular text. It is often used to make computer data readable and publishable on multiple platforms.

Microsoft to appeal
Microsoft, which has been involved in a number of legal battles, said that it will appeal in higher court in Washington and is hopeful that the ban will be stayed by the judges.

"We are disappointed by the court's ruling," Microsoft spokesman Kevin Kutz said in an e-mail. "We believe the evidence clearly demonstrated that we do not infringe and that the i4i patent is invalid."

The judgment could impact sales
The Word software is a part of Microsoft office. The injunction can potentially hurt the sales of MS Office, which recorded $18 million in revenue in the last fiscal year.

Both Word and Office are of strategic importance to the software behemoth as it is used by millions of consumers worldwide for everyday works like word processing, preparing spreadsheets, presentations etc.

Further, the software is the front end to information stored in Microsoft's SharePoint server and SQL Server database. The ban could adversely affect company’s future plans related to these products.