IP News

On August 11, 2003 a jury in the Northern District of Illinois awarded Eolas Technologies, Inc. $521 million in damages for patent infringement against Microsoft Corporation. The patent at issue, U.S. Patent 5,838,906, claims a method of sending interactive software applications over the Internet that makes “plug-ins” and “applets” possible. The suit, 99-CV-626, was filed in 1999 by Eolas, the exclusive licensee of the patent owned by the University of California. While at the University of California, Michael Doyle, founder of Eolas, helped develop the technology as a way of assisting medical students and practitioners to access inexpensive, high-resolution medical-image data over the Internet. The suit alleged that Microsoft began using the technology in its Web browser soon after the patent was filed and continued to use it after the patent issued in 1998. Eolas stated that a license had been offered to Microsoft, but the offer was declined.

Microsoft refuted the infringement claims and challenged the validity of Eolas' patent by claiming another had invented the technology earlier and that the patent described features the technology was not capable of performing. Eolas had initially requested $1.2 billion in damages, but the jury's special verdict awarded Eolas $521 million based on a reasonable royalty of $1.47 per unit of the more than 354 million copies of Microsoft's Windows Web-enabled operating system sold. Eolas has not yet sought an injunction against the sale of Windows, but is seeking to have the award increased. Microsoft has vowed to appeal the verdict. A decision from an inequitable conduct bench trial has yet to be rendered. Microsoft faces more than 30 other patent infringement suits.