MS Accused of $388M Piracy, using AntiPiracy Software

A federal court has fined Microsoft $388 million for breaching the copyright of a rival software company. Ironically, the firm concerned was a producer of anti-piracy products.

The court found Microsoft breached a patent belonging to Uniloc and involved the copy protection used on Windows XP and some parts of the Microsoft Office suite. Microsoft had not licensed the technology used in the activation process by which a product can be installed repeatedly on a single machine but can't be shared with other people or copied to another computer.

Award Among All-Time Highs

The sum is believed to be one of the largest damages ever awarded in a patent law case.

That's due in part to how widespread Microsoft's use of the technology was and how many individual customers it involved. If upheld, the fine would be relatively small, but still a blow to Microsoft's profits. It represents 1.7% of the profits it achieved in 2007-2008.

Even by the standards of intellectual property cases, this was a complicated affair. The trial, which began last month, followed a six-year legal disagreement. A previous district court ruling issued a summary judgment in favor of Microsoft, meaning the case appeared so clear-cut there was no need for trial. However, an appeal court disagreed and called for a full jury trial in federal court. (Source: cnet.com)

Microsoft Says Facts Are Wrong

Microsoft said it plans to appeal against the verdict: "We believe that we do not infringe, that the patent is invalid and that this award of damages is legally and factually unsupported." (Source: reuters.com)

Uniloc made its name through copy protection systems used for trial copies of software given away with discs attached to computer magazines. It later developed this as a system where a single disc held dozens of applications which could only be used in trial mode until the full version was unlocked by the customer buying the product.