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Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times reporter Sharon Chan.

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September 25, 2008 11:20 AM

Legal roundup: Microsoft off the hook (again) in $1.5 billion patent infringement case; makes progress on U.S. antitrust front

Posted by Benjamin J. Romano

The U.S. Court of Appeals for the Federal Circuit ruled in Microsoft's favor on an appeal of a $1.5 billion patent infringement damage award. At issue were two digital music patents owned by Alcatel-Lucent, but originally granted to Fraunhofer Gesellschaft, a German company.

Meanwhile, Microsoft and its antitrust minders made progress in a regular status conference on their extended settlement.

Back to Alcatel-Lucent: After getting slapped with an eye-popping (and record-setting) $1.52 billion jury award in February 2007, Microsoft had asked U.S. District Court Judge Rudi Brewster to reverse the original verdict, order a new trial or dramatically reduce the damage award.

Brewster ruled in August 2007 that Windows Media Player does not infringe on one of the patents, and Microsoft had properly paid Fraunhofer to license the other one. Paris-based Alcatel-Lucent appealed Brewster's reversal, which was upheld today by the U.S. Court of Appeals for the Federal Circuit. See coverage from Reuters.

On the antitrust front, attorneys for Microsoft and the state and federal governments involved in the settlement met this morning in Courtroom 28A for a regularly scheduled quarterly status conference before U.S. District Court Judge Colleen Kollar-Kotelly.

They tackled an important, albeit boring, issue that has been nagging the parties for years: technical documentation of complex communications protocols needed to help non-Windows servers work with Windows computers as well as Windows servers do. By holding back that information, Microsoft illegally leveraged its Windows monopoly to gain power in an adjacent market. This documentation is a central piece of the antitrust remedy.

Early on, Microsoft dragged its feet in providing that documentation by not devoting enough resources to the effort.

Kollar-Kotelly, in a January ruling extending the settlement into late 2009, wrote that the parties to the settlement anticipated that the documentation would be available by February 2003, at the latest.

"More than five years later, the technical documentation ... is still not available to licensees in a complete, usable, and certifiably accurate form," Kollar-Kotelly wrote.

Lately, the parties have been wrangling over templates for a set of additional "system documents" -- detailing the "interaction between the protocols in a number of complex scenarios," according to a joint status report filed last week. These system documents were in response to plaintiffs' concerns that an original set of overview documents was "not sufficiently comprehensive."

In its portion of the JSR, Microsoft stated that it "firmly believes that the current protocol documentation available to implementers enables interoperability with Windows and fully complies with the Final Judgments." (Oh my Dad this is boring.)

More than 800 Microsoft employees and contingent staff, led by Bob Muglia, Microsoft's senior vice president of server and tools, are at work on the documentation effort.

Anyway, the parties are reaching agreement on the templates for the system documents. A Dow Jones report from today's status hearing describes it as "essentially a 50-plus page instruction manual that Microsoft engineers must use to write and re-write the technical documents in question."

But there's no end to the documentation: Microsoft told the states that "changes to protocols in Windows 7 will
result in a significant number of new and modified technical documents," according to the joint status report. They are expected to be ready for review later this year.

Also on the Windows 7 front: The states' "Technical Committee" -- which does all this deep-in-the-documentation testing -- will conduct middleware-related tests of early builds of Windows 7 "in an effort to assure that bugs fixed in Vista do not re-appear in the next operating system, as well as to assure Final Judgment compliance generally."

Microsoft, in its portion of the joint status report, noted that its published communication protocols -- made available for free earlier this year -- have been downloaded 209,000 times.

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