Microsoft Settles Fight Over Uniloc Anti-Piracy Patent

Microsoft Corp. (MSFT), the world’s biggest software maker, said it settled an eight-year legal battle with a Singapore company over a patent on technology to deter piracy.

Financial terms weren’t disclosed, said David Cuddy, a Microsoft spokesman. The companies reached a “final and mutually agreeable resolution” to a dispute begun in September 2003. A trial was under way before a federal jury in Providence, Rhode Island, to determine how much Microsoft should pay Uniloc USA Inc. and Uniloc Singapore Private Ltd. for infringing the patent.

A different jury in 2009 had said Microsoft infringed the Uniloc patent and awarded $388 million in damages. An appeals court upheld the verdict and threw out the dollar figure, saying it was “fundamentally tainted” by the numbers used at trial to calculate how much Microsoft should pay.

The case concerned a Microsoft product known as Clearinghouse that activates Microsoft programs including Windows XP, Office XP, Office 2003 and Windows Server 2003. The trial that began last week was to determine how much Microsoft should pay to use the invention through Nov. 11, 2011, according to court documents.

The patent covers a software registration system to deter illegal copying. The user enters information, such as a serial number, to determine whether the program is an authorized version.

Uniloc has filed suit over the same patent against software companies in federal court in Tyler, Texas, including Symantec Corp. (SYMC) and Adobe Systems Inc. (ADBE) Some of those, including Adobe, have reached settlement agreements. Uniloc Singapore owns the patent and Uniloc USA is the exclusive licensee.

The court case is Uniloc USA Inc. v. Microsoft Corp., 03cv440, U.S. District Court, District of Rhode Island (Providence).

To contact the reporters on this story: Susan Decker in Washington at sdecker1@bloomberg.net;

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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