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Microsoft Wins Infringement Decision Against Alcatel-Lucent

August 7, 2007

Earlier today, Judge Rudi Brewster of the U.S. District Court for the Southern District of California dismissed a $1.5 billion verdict against Microsoft for infringement on an MP3-related patent held by Alcatel-Lucent.

Judge Brewster found that a jury improperly ruled in favor of Alcatel-Lucent.  He based his decision on a finding that one of the so-called infringing patents was not owned outright by the formerly independent Lucent, but jointly by former Lucent parent AT&T and German-based Fraunhofer. The findings pointed to a legacy Fraunhofer rights clause to license the patent.

 "Today's ruling by the judge reversing the jury's $1.52 billion verdict against Microsoft is a victory for consumers of digital music and a triumph for common sense in the patent system. For the hundreds of companies large and small that rely on MP3 technology, the Court's ruling clarifies that these companies have properly licensed the technology embodied in the '080 patent from its co-owner and industry recognized MP3 licensor--Fraunhofer," Microsoft said in a statement.

`"The reversal of the judge's own pre-trial and post-trial rulings is shocking and disturbing,'' Alcatel-Lucent spokeswoman Mary Ward said in a phone interview with Bloomberg News.``The jury unanimously agreed with us. We believe their decision should stand.''

Alcatel-Lucent plans to appeal, Ward said.

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