It sounds like the Burst.com case all over again, but this time, it's Alacritech suing Microsoft and winning a preliminary injunction, according to InternetNews.com. They say it could "keep Microsoft's Longhorn from getting out of the gate", because Alacritech claims Longhorn, and the Scalable Networking Pack for Windows Server 2003, includes their patented technology:
According to Alacritech, the company met with Microsoft and described its own Dynamic TCP Offload architecture, known as SLIC Technology, under a non-disclosure agreement in September 1998. Then, in April 1999, at Microsoft's request, it delivered a detailed document describing how SLIC could be integrated with Windows. It then shipped its first product based on SLIC in April 2000.
Microsoft broke off communications with Alacritech in June 1999, according to Alacritech, then presented Chimney in May 2003. . . .
"After Alacritech discovered that Microsoft Chimney is based on intellectual property that we developed, patented and own, we offered Microsoft a license," Larry Boucher, president and CEO of Alacritech, said in a statement. "Microsoft rejected licensing terms that would be acceptable to us. We were forced to sue Microsoft to stop them from continuing to infringe, and inducing others to infringe, on our intellectual property rights." The company refused further comment.
So, Microsoft is probably wanting to tweak the patent system right about now, I'm thinking.
UPDATE: Marbux found the complaint [PDF], the answer [PDF] and the Order Granting Preliminary Injunction [PDF], which says Alacritech was entitled to the preliminary injunction because, for one thing, they demonstrated a likelihood of success on the merits with respect to validity and infringement.