After winning patent suit, DRM company sues Microsoft again

A company that just won more than US$140 million from Microsoft on appeal for a patent suit is suing the company again.

A company that was just awarded more than US$140 million from Microsoft in a patent-infringement suit has sued the software giant again, this time for alleged infringements in Windows Vista and Office 2007.

Z4 Technologies claims Microsoft has only made "an insignificant change" in Vista and Office to product-activation technology that has been found by US courts to violate patents z4 holds. The privately held company claims that it notified Microsoft of the infringement on December 19, 2006, but Microsoft has not remedied the situation.

Earlier this month, a federal appeals court upheld a ruling z4 was awarded last year in Texas on a suit it filed in 2004 against both Microsoft and Autodesk for infringing on US Patent No. 6,044,471 and US Patent No. 6,785,825. The patents, which z4 holds, are for product-activation technology aimed at preventing unauthorized use or piracy of software. Z4, founded by David Colvin, creates digital rights management technology.

In April 2006, a jury in the US District Court in Eastern Texas found that both Microsoft and Autodesk infringed on those patents, ordering Microsoft to pay US$115 million to z4 and Autodesk US$18 million.

Several months later in August, the judge presiding over the case slapped US$25 million more in damages on Microsoft for litigation misconduct, saying in his ruling that the software company tried to have z4's patents declared unenforceable even as it continued to willfully infringe on those patents and withheld evidence of its actions. US District Judge Leonard Davis also upheld the original fines and ordered Microsoft to pay z4 US$1.98 million and Autodesk US$322,000 in attorney fees.

Microsoft appealed the Texas court's decision, but the US Court of Appeals for the Federal Circuit upheld it on November 16.

Microsoft spokesman David Bowermaster said on Thursday that Microsoft does not believe Vista or Office 2007 infringe on z4's patents, and the company is in the process of reviewing the suit.

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Elizabeth Montalbano

IDG News Service
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