Microsoft Loses Patent Case

A Texas jury awarded $133 million to a Michigan man on Wednesday as part of a patent dispute involving software makers Microsoft and Autodesk. Microsoft was ordered to pay $115 million, whereas Autodesk has to pay only $18 million. David Colvin, who founded Z4 Technologies, accused the companies of infringing on his company's patented antipiracy software technology in products such as Microsoft Windows XP and Office and Autodesk AutoCAD. Colvin obtained patents in 2000 and 2004 for antipiracy software called "product activation" that specifies how passwords and codes are assigned to individual copies of software. However, Microsoft and Autodesk claim that they developed their own software-based antipiracy technology independently before Colvin filed his patent applications in 1998. Microsoft uses the technology in its product activation feature in various versions of Windows and Office.

"While we are disappointed with this verdict, we continue to contend that there was no infringement of any kind and that the facts in this case show that Microsoft developed its own product activation technologies well before z4 Technologies filed for its patent," a Microsoft representative said. An Autodesk representative said the decision was "surprising and disappointing."

The Texas verdict represents the second largest patent award against Microsoft. (The $521 million award in the Eolas Technologies patent case remains the most damaging patent battle against Microsoft.) Microsoft hasn't decided yet whether it will appeal the decision. According to Microsoft, Colvin knowingly withheld information about his antipiracy technologies when he filed for his patent with the United States Patent and Trademark Office (USPTO).

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