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US Supreme Court Rejects Microsoft Appeal Request - 01 Nov 2005

The US Supreme Court yesterday declined a request by Microsoft that it hear the software giant's appeal of the Eolas Web browser patent infringement case. The high court gave no reason for its refusal.

The Eolas case has been a rollercoaster ride for Microsoft. Eolas first sued Microsoft in 1999, claiming that Internet Explorer (IE) infringed on a University of California patent for which it is the sole licensee. The patent describes a system for accessing embedded program objects in a browser, such as plug-ins for media players. After a 2003 trial, a jury awarded Eolas $521 million, but a subsequent appeal and questions about the validity of the patent overturned the verdict in March 2005.

Surprisingly, the US Patent & Trademark Office ruled in September that Eolas' patent was valid, despite numerous examples of prior art. The US District Court in Chicago is still examining the validity of the patent, however, and a new trial will determine whether Microsoft must pay the $521 million award to Eolas. Curiously, Microsoft's request before the US Supreme Court involved determining how damages in the case should be calculated. The $521 million verdict is apparently based on worldwide sales of Windows, which includes IE, while Microsoft is arguing that Eolas should only be able to make a claim against US sales, should its patent be ruled valid.

"We will continue with the trial of the remanded case before the District Court and we're confident that our position will ultimately prevail," a Microsoft spokesperson said. A date for the new trial has yet to be set. Eolas, meanwhile, appears to be confident it will win the case. "We don't believe the outcome will be any different in front of the court than it was in the patent office," an Eolas lawyer said.

The Eolas patent has caused a stir in the Web developer community because the patent is so wide-ranging and could ultimately affect many companies and people. In a rare moment of unity, numerous trade groups, organizations, and even the World Wide Web Consortium (W3C) rallied around Microsoft's efforts to nullify the Eolas patent, because of the negative effects that patent will have on the industry. The W3C argues that the Eolas patent could result in the destruction of "millions of historically important Web pages," which had been designed to follow Web standards.

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