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The i4i v. Microsoft Order Staying the Injunction - Updated
Friday, September 04 2009 @ 11:01 PM EDT

I have the Order [PDF] for you from the US Court of Appeals for the Federal Circuit in the i4i v. Microsoft case. Checking the docket, we see there are some other documents we haven't seen yet, and we'll try to get those next week. It's puzzling why the court makes some documents digitally available but not the briefs. For example, the Washington Legal Foundation filed an amicus brief, and i4i filed an opposition and then Microsoft replied, and we haven't seen any of that, or even heard about it. The Foundation is linked to the law firm where Bill Gates' father's used to practice law, K & L Gates LLP, before his retirement.

It's frustrating that the media tells us what is in an order, or part of what it in an order, or what the order might mean, but they don't provide the order itself or all the briefs. Please, guys, if you have the documents, send them to me if you don't want to publish yourselves. We'll gladly make them available, and you can give yourselves a head start if you wish before I publish. But this is history, and we should be documenting what is happening, don't you think? And this case can affect a lot of people, so we are naturally interested. If any journalist has any of these missing filings, please email me, to save Groklaw folks another trip on foot. I don't at all understand why neither party is making these documents more readily available.

The order itself is quite simple:

NOTE: This order is nonprecedential.

UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT

2009-1504

I4I LIMITED PARTNERSHIP and
INFRASTRUCTURES FOR INFORMATION INC.,

Plaintiffs-Appellees,

v.

MICROSOFT CORPORATION,

Defendant-Appellant.

Appeal from the United States District Court for the Eastern District of
Texas in case no. 07-CV-113, Judge Leonard Davis.

ON MOTION

PER CURIAM

ORDER

Microsoft Corporation moves for a stay, pending appeal of the district court's injunction. The appellees oppose. Microsoft replies.

Without prejudicing the ultimate determination of this case by the merits panel, the court determines based upon the motion papers submitted that Microsoft has met its burden to obtain a stay of the injunction.

Accordingly,

IT IS ORDERED THAT:

The motion is granted.

When it says this order is nonprecedential, it means it's not binding case law. Beyond that explanation, it gets complicated. Here's an article on the Marquette University Law School Faculty Blog that explains a bit more deeply if you wish to dig further. [ Update: Patently O explains the per curiam part:
Interestingly, the stay order indicates that it is a per curiam decision, but the order was signed by the Federal Circuit Clerk Jan Horbaly "for the court." I see this as an indication that the judges assigned to the merits panel do not yet want to reveal their identities.

The unfortunate part of this decision is that it does not define what it takes to meet the "burden to obtain a stay of the injunction" - especially in the wake of eBay. How does the court go about deciding whether to stay relief? How important is the fact that briefing of the merits are being expedited? What role did the amicus briefs by HP and Dell play in the decision?

- End update.]

And when it says this stay doesn't prejudice the ultimate determination, it means this is just a stay, not a ruling on who should ultimately prevail. There will be a hearing later this month, on the 23rd, so this isn't to be taken as a clue as to any outcome one way or another. If you recall the timing in the SCO v. Novell appeal, you can get an idea of the timing here. Microsoft gets a stay, but because it asked for and got an expedited hearing, it may not be much of one. The drop dead date was October 10. If it wins on appeal, there is no injunction. But if it loses, it all could happen almost on the original schedule, maybe a couple of months longer, depending on how fast the court issues its ruling.

I wish all software patents would go away. Microsoft can afford this. Another Linus writing FOSS code in a university somewhere can't. And that's part of what's wrong with software patents. They do not help FOSS. They get in the way, and they ensure that only the big boys can play the patent game. If you want software only from large vendors, great. But if you want another Linux, you need to think about all this.

Microsoft doesn't want another Linux, of course. It hates the first one. But what about you?

Here's the entry on the amicus brief from the Washington Legal Foundation from the docket for you:

9/3/2009 Brief of Washington Legal Foundation as Amicus Curiae In Support of Defendant-Appellant Supporting Reversal . BY Washington Legal Foundation (Amicus ). SERVED BY Mail ON 9/3/2009. FILED ON 9/3/2009 . (NON-CONFIDENTIAL)
Here's who that is, according to SourceWatch. If I have understood that page, they fight against legal activism by means of legal activism:
The Washington Legal Foundation (WLF) was established in 1977 to "fight activist lawyers, regulators, and intrusive government agencies at the federal and state levels, in the courts and regulatory agencies across the country"....

The foundation states that it has "one goal" which is: "to defend and promote the principles of freedom and justice." Since it was founded 25 years ago, WLF has developed into the nation's preeminent center for public interest law, advocating free-enterprise principles, responsible government, property rights, a strong national security and defense, and balanced civil and criminal justice system.

WLF is a unique institution with three essential cornerstone programs:

* shaping public policy through aggressive litigation and advocacy
* publishing timely legal studies
* educating policy-makers and the public through extensive communications outreach
[...] With this unique approach, litigating precedent-setting issues in the courts and before government agencies, publishing and marketing timely and relevant legal studies, and ensuring maximum exposure for its work with policy-makers and the media, the Washington Legal Foundation is able to shape public policy and work with allies in government and our legal system to strengthen America's free enterprise system."
I wish they'd do something about the USPTO and software patents. I know. That would perhaps be a new thought to them, but the truth is, software patents are doing real harm to free enterprise, particularly to Free and Open Source software, and this case is an obvious proof of the harm that software patents can cause. The head of the Foundation has submitted a pro hac vice application to the court. So this case gets bigger and bigger in its implications. It's Washington as in DC, by the way, not as in the state. And they are filing in support of Microsoft, which will not surprise you. On the page I linked to about the law firm, it says this:
"This dynamic organization is a prominent force in both judicial and regulatory arenas, promoting economic growth and allowing free enterprise to prosper. If you share my beliefs that our country’s ability to compete in the world economy should not be hindered by excessive regulation and unreasonable court decisions, I encourage you to join WLF in defending free enterprise."

The Honorable Dick Thornburgh
K&L Gates LLP
Chairman, WLF Legal Policy Advisory Board

I wonder if the situation was reversed who they would support? If i4i had been found guilty of infringing Microsoft's patent, then would they file an amicus brief in support of an i4i motion to stay an injunction?

And look at this entry:

9/3/2009 MOTION: Entry 40 :by Appellee - Motion to replace Confidential documents. SERVICE : by Hand on 9/3/2009
ACTION: Entry 42 :Granted. The previously filed documents will be destroyed by the Clerk's office. Filed: 9/3/2009
Already? Microsoft is like the Lone Ranger. In it rides, does its thing on the docket, and disappears it all without a trace. Who was that masked man?

Kidding. I believe in confidentiality, as you know, but Microsoft is by far the most secretive litigant I've ever seen. Remember Canopy destroying Microsoft documents and turning them into toilet paper? And I can't help but wonder if that is why it's so hard to get the documents digitally in this case. It certainly feels like things are happening in the dark, behind closed doors.

Meanwhile, with all the big guns marching on to Microsoft's battleship and reporting for duty, what about i4i? Isn't patent law supposed to work for you, no matter whether you are big or small? I wonder what they are thinking? The Globe and Mail's Simon Avery found out:

Loudon Owen, chairman of i4i, said he remains confident that the appeals court will uphold last month's decision of the U.S. District Court for the Eastern District of Texas. “Microsoft's scare tactics about the consequences of the injunction cannot shield it from the imminent review of the case by the Federal Circuit Court of Appeal,” he said....

“To paraphrase the great heavyweight boxing champion Joe Louis, ‘They can run, but they can't hide.' Microsoft's time will eventually run out,” said Mr. Owen, who is also chairman of The Fight Network and a former Ontario College boxing champion as well as an expert in Brazilian jiu jitsu.

I'm finding you have to read Canadian press to get much of i4i's side of the story, which could be an indication of the disparity in funding for things like PR, and the court isn't helping by forcing us to do some jiu jitsu ourselves even to follow along with the appeal.

Update: The Washington Legal Foundation has made its amicus brief available here [PDF]. The brief addresses not the question of whether Microsoft is liable for patent infringement, but only the remedies.

It feels the damages awarded are excessive, the experts for i4i were "unreliable" in that the method of calculating damages was not based on solid evidence, and the jury shouldn't have been allowed to hear that testimony, and the $40 million in enhanced damages was improper, in that the court "ignored" Microsoft defenses.

As for the injunctive relief, it argues that it is "unsound":

The Supreme Court has made abundantly clear that injunctive relief is an "extraordinary remedy" that does not follow as a matter of course to a prevailing plaintiff, Winter v. Natural Res. Def. Council, Inc., 129 S. Ct. 365, 375-76 (2008), and that traditional equitable standards apply "in patent damages no less than in other cases". eBay, Inc. v. MercExchange, L.L.C. 547 U.S. 388, 394 (2006). Yet, the district court here paid only lip service to these controlling principles, and instead rooted its injunction in overbroad presumptions that are irreconcilable with Winter and eBay.
It also argues that in close cases, where there are many defenses presented, a finding of wilfullness is inappropriate. In close cases, the party found to infringe may legitimately have viewed that it was not infringing, as opposed to recklessly going forward with knowledge of infringement. The problem with that, as we've seen in a number of the cases we followed here on Groklaw, is that with a lot of money comes lawyers, who can argue most fervently the most absolutely ridiculous claims and defenses which are sometimes even successful although they shouldn't be, so I don't know if that makes for a good way to measure.

It also feels that the court erred in viewing i4i and Microsoft as being in competition:

It is more than passing strange to think of Word as being in competition with a software add-on that functions as a tiny component of Word and that most users do not even know exists, let alone have any idea how to use.
Hmm. If so, why can't Microsoft just get rid of it? It argued very differently about customXML's importance during Microsoft's effort to get OOXML accepted as a standard. And while currently i4i sells an add-on product, when this all began, it was not. It was selling a product Microsoft recommended until they more or less put i4i out of that business, or at least that's how I recall the judge's order. So, if you put someone out of business, then can you benefit from the altered state of your vanquished competition and argue that because you've left them gasping on their backs on the field, now they are not competitors and so they shouldn't get an injunction? Mighty cold.

On the excessive damages awarded, in the Foundation's view, it writes:

As the Supreme Court has explained, excessive damages awards raise constitutional concerns. See, e.g., State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408 (2003); BMW of N. Am. Inc. v. Gore, 517 U.S. (1996). Due Process principles "prohibit [] the imposition of grossly excessive or arbitrary" awards..."
Say, send a memo to the RIAA, please. Did the Washington Legal Foundation submit an amicus brief in Tenenbaum or the Jammie Thomas' cases? No? I believe this is exactly the argument that will show up in the Tenenbaum appeal, so it's not too late.

Then, the Foundation argues that the district court followed a cramped concept of the public interest. Health and safety are not the only issues; the courts should also think about customers and other businesses that would be affected. Hence Dell and HP show up saying they will be affected by this tiny component of Word that is so insignificant that Microsoft and they can't possibly remove it in time to abide by the injunction?

The district court here, however, ignored much of the public impact of forcing a redesign of Word. Although the court asserted that the injunction would have little effect on "current customers," the opinion is silent regarding the potential impact on future customers. A57. The court acknowledged that the task of reissuing Word without the infringing component would be "enormous," but said nothing about what this may mean for those who would like to purchase Word before Microsoft is able to complete the Herculean task.
Well, customers have no legal right to infringe i4i's patents either, last I looked, so any inconvenience stems from buying products that infringe or from distributing same. And I believe Dell and HP said they'd need 120 days.

It may be Herculean to remove that "tiny component" but clearly they didn't think it would take forever.

Finally, the Foundation argues that just because Microsoft is rich and i4i is not, the court shouldn't give that undue weight in balancing the hardships. It might be appropriate sometimes, but this court "abused its discretion by resorting to a David-and-Goliath caricature while failing to take meaningful account of the extraordinary burdens that its sweeping injunction would impose on Microsoft..."

By then my lip was curling just a bit. What the Foundation would like the court to do is reverse the damages award and the permanent injunction, and "remand for further proceedings on an appropriate remedy".


  


The i4i v. Microsoft Order Staying the Injunction - Updated | 116 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections thread
Authored by: songmaster on Friday, September 04 2009 @ 11:27 PM EDT
Please use the subject line...

[ Reply to This | # ]

Off Topic thread
Authored by: songmaster on Friday, September 04 2009 @ 11:28 PM EDT
Comments that don't relate to the main post...

[ Reply to This | # ]

only the big boys can play the patent game
Authored by: Anonymous on Friday, September 04 2009 @ 11:31 PM EDT
It would be nice to see PJ's analysis of IBM's Bilski Amicus brief that claims
software patents benefit the little guy.

Karl O. Pinc <kop@meme.com>

[ Reply to This | # ]

[NP] News Picks discussion
Authored by: songmaster on Friday, September 04 2009 @ 11:32 PM EDT
#3!

[ Reply to This | # ]

Injunction saves Word
Authored by: Anonymous on Saturday, September 05 2009 @ 02:35 AM EDT
Injunction saves Word, world still doomed. I hope this takes some of the air out
of ooxml's sails. Since Microsoft has demonstrated it can produce a file
conforming to the ODF standard but incompatible with all other implementations.
Interoperability with Microsoft is DOA so if you don't want to get locked in you
have move on. Too bad the ISO had to lose all it's credibility over it.

[ Reply to This | # ]

If I Could Reform Patent Law
Authored by: Anonymous on Saturday, September 05 2009 @ 04:37 AM EDT
If I could rewrite patent law, I would add the following provisions.

1. Only the actual inventor can hold a patent and only if they actual create a
working implementation of the invention patented. If an invention is created as
a work for hire, then the entity who commissioned the work is considered the
inventor for purposes of satisfying this clause.

2. If a patent is sold, the purchasing entity must create a working
implementation of the invention patented. If they fail to do so within 6 months
of purchase, then the patented invention reverts to the public domain. During
this 6 month period, the purchasing entity may not initiate legal action against
any other entity for infringement of the patent, however if they meet the 6
month implementation requirement and a company is found to have knowingly
infringed on that patent during the 6 month period, then the patent holder shall
be entitled to treble damages for said infringement.

3. Patents held by the original inventor shall be considered part of the estate
of the inventor and shall pass to the inventor's heirs in the event the inventor
dies while the patent is still in effect.

4. Patent applications must be reviewed by a panel of experts in the field to
which the patent applies and would be subject to a 6 month public review period
in which anyone can make written objections to the patent based on prior art and
obviousness of the proposed patent. The patent may not be granted until every
objection is addressed by the expert panel.

I think that by requiring each patent holder whether they are an inventor or a
company, to actually create something that implements the patent would greatly
reduce or eliminate companies created solely for the purchase of buying up
patents and suing people for infringement. And by making patents go through a
expert and public review process instead of relying on the USPTO patent
examiners, I think that fewer bad patents would be granted in the first place.

I realize I am just dreaming here, but it just seems insane to me that companies
can exist solely for the purpose of buying "ideas" and make money off
the inventions of others without contributing anything. And the patent
examiners currently in place don't seem to have any real expertise in anything
except rubber stamping stupid patents.

[ Reply to This | # ]

I want MORE!
Authored by: Ian Al on Saturday, September 05 2009 @ 06:27 AM EDT
The stay does not seem to provide a balance of equities (I think that's what PJ
called it). In other words, the stay should not unacceptably harm one side much
more than the other.

From what I see, i4i is proportionately much more harmed by the stay than
Microsoft would be by denial of the stay.

I would have hoped that the judge(s?) would have said what the key factors
presented to them lead them to decide that the equities were broadly balanced by
the stay.

It might have changed my view of the stay order.

---
Regards
Ian Al

Linux: Viri can't hear you in free space.

[ Reply to This | # ]

  • I want MORE! - Authored by: Anonymous on Saturday, September 05 2009 @ 07:01 AM EDT
  • adding up - Authored by: Anonymous on Saturday, September 05 2009 @ 09:56 AM EDT
  • Less is more - Authored by: stegu on Saturday, September 05 2009 @ 12:00 PM EDT
    • Less is more - Authored by: Anonymous on Sunday, September 06 2009 @ 07:10 PM EDT
The i4i brief
Authored by: Anonymous on Saturday, September 05 2009 @ 06:53 AM EDT
If I understand correctly, you're saying you don't have the brief i4i filed. I found it posted on their website.

L ink

[ Reply to This | # ]

Met its burden?
Authored by: amster69 on Saturday, September 05 2009 @ 07:40 AM EDT
"Microsoft has met its burden to obtain a stay of the injunction"

What does 'met its burden' mean in plain english?

Bob

[ Reply to This | # ]

The i4i v. Microsoft Order Staying the Injunction
Authored by: josmith42 on Saturday, September 05 2009 @ 08:51 AM EDT
"Microsoft doesn't want another Linux, of course. It hates the first one.
But what about you?"

What about Red Had, IBM, Nokia, Linksys, Novell, etc.? It's not just
individuals who benefit from Linuxes. (Of course, PJ may have been including
companies in that "you" anyway.)

---
This comment was typed using the QWERTY keyboard layout. I used to use Dvorak,
but no longer :-(

[ Reply to This | # ]

Things Aren't What They Used To Be...And Perhaps They Never Were
Authored by: TheBlueSkyRanger on Saturday, September 05 2009 @ 12:13 PM EDT
Hey, everybody!

Has the patent system always been like this?

I'm wondering if allt he patent rows lately are the result of recent policies,
or if they've always been there, companies knew to take advantage of them, and
now that the process can be viewed by the people, the people are trying to
correct a process supposedly to benefit them but was never really pushed in that
direction?

Dobre utka,
The Blue Sky Ranger
who seems to be feeling philosophical today

[ Reply to This | # ]

They don't help small companies, either
Authored by: Anonymous on Saturday, September 05 2009 @ 12:31 PM EDT

And that's part of what's wrong with software patents. They do not help FOSS

Let's look at the bigger picture here: software patents help only companies with deep pockets: well-established large corporations like IBM and Microsoft. Software patents help these companies to destroy competition from small companies before it gets properly started.

This is a better argument to use with the politicians than the effect on FOSS, because small companies are the engine of employment growth in the USA (and AFAIK in most developed countries). Politicians are always saying they want to encourage creation of more jobs. Well, the way to do that is to make it easier for small companies to survive and grow. And in the software field, that means abolishing software patents.

Our problem (and I don't just mean Groklaw's problem, or FOSS' problem, I mean everybody's problem except the people who work for megacorporations) is that IBM, Microsoft, etc can afford a lot of money to bribe politicians ("campaign donations" etc, it's all completely legal, but it's still bribery, according to the definition in my dictionary). I don't see any effective counter to that.

[ Reply to This | # ]

K & L Gates
Authored by: Anonymous on Saturday, September 05 2009 @ 01:56 PM EDT
The WLF legal chief is the partner of the late William Gates Sr. K & L Gates
is his old legal firm.

[ Reply to This | # ]

The i4i v. Microsoft Order Staying the Injunction - Updated
Authored by: webster on Saturday, September 05 2009 @ 09:13 PM EDT

The brief by the Foundation has been mislabeled and mis-characterized. They aren't assisting the court with any special public interest issue. They are repeating and amplifying the appellant's arguments. It sounds like they are in cohoots. Call it amicus monopolii.

~webster~

[ Reply to This | # ]

The Biggest Problem With SOFTWARE Patents
Authored by: Anonymous on Saturday, September 05 2009 @ 09:39 PM EDT
Patents came to software quite late in the game. There were several old jokes
about building a better mousetrap. When software patents were opened for a land
grab, patents were granted on a mouse being caught, by ANY method. Since there
was no prior art (and the internet could not be used to check, let alone open
source) the patent was granted. The patents claimed, and granted, are so
outrageously broad, that software can no longer be written legally.

The second major problem with software patents is the speed of software
innovation and change. That will come to a screeching halt if the existing
software patents are allowed to stand until they expire.

I hate to think of Vista (Windows 7, whatever) and OSX as being the pinnacle of
software usability for the rest of my life. (Yes, I use KDE.)

-- Alma

[ Reply to This | # ]

section 2.14.3 of the ISO/IEC Directives
Authored by: Alan Bell on Sunday, September 06 2009 @ 05:01 PM EDT
PJ, you asked the question "Why didn't Microsoft tell anyone?", I was
thinking about this and I looked at the rules. I thought it might be that they
properly declared all their patents at the time and they were perhaps not
required to declare other people's alleged patent claims, so I checked the
rules. 2.14.2 states:
The originator of a proposal for a document shall draw the attention of the
committee to
any patent rights of which the originator is aware and considers to cover any
item of the
proposal.

so they did have an obligation as originator to draw the attention of the
committee to the issue. Conceivably they may have done this, and had it nodded
through anyway - whether it was or not tells us something about Microsoft and or
ISO (possibly not anything new) but ultimately it doesn't matter, because of
2.14.3

2.14.3 Should it be revealed after publication of a document that licences under
patent
rights, which appear to cover items included in the document, cannot be obtained
under
reasonable and non-discriminatory terms and conditions, the document shall be
referred back
to the relevant committee for further consideration.

Well here we go. I think this situation was revealed after publication, the
patent in question appears to cover items in the document, as i4i have taken
Microsoft to court the terms of the license would not appear to be RAND, so back
to the "relevant committee" it goes.

There don't appear to be any timescales attached to this clause so it is
anyone's guess when they will do anything about it. I am not sure what the
relevant committee is, and I am not sure what it means for a document to be
"referred back to the committee". If anyone can throw light on this
that would be great

[ Reply to This | # ]

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