Innovation Asset Blog

Court upholds Microsoft's guilt in patent infringement case regarding piracy software

An appeals court ruled this week that Microsoft, the world's largest software manufacturer, violated a patent that, ironically, is designed to prevent software piracy.

The U.S. Court of Appeals for the Federal Circuit in Washington confirmed the legitimacy of an anti-counterfeiting patent held by Uniloc USA and Uniloc Singapore, but also ordered a new trial to re-evaluate the damages originally sought by California-based Uniloc.

"It's a strong validation of the value of the patent," Brad Davis, CEO of Uniloc USA, told Bloomberg. "The damages issue is what it is, and we'll live with it. We have a sense of how much we contributed to Microsoft's bottom line."

However, the ruling pointed out that a lower court's 2009 assessment of $388 million in damages was "fundamentally tainted by the use of a legally inadequate methodology," according to the Inquirer. As a result, it is unlikely that Microsoft will have to pay the original fee, which, according to the ruling judges, was based on a faulty assumption that 25 percent of a product's value should be awarded to the patent owner.

David Howard, deputy general counsel for Microsoft, told Bloomberg that the court's decision was an important move toward the end of unreasonable damages assessments based on broken methodologies.

Peter Ackerman

Peter Ackerman

Founder & CEO, Innovation Asset Group, Inc.