Yesterday morning, I was sitting at my computer, refreshing my Twitter feed. Road closures, weather alerts (it was 101° F today at Reagan National Airport), blah, blah, blah. Same-old, same-old. What’s this? A tweet from SCOTUSblog about Microsoft v. i4i?

The Supreme Court handed down its decision in Microsoft Corp. v. i4i Limited Partnership et al early on June 9th, affirming the decision of the Court of Appeals for the Federal Circuit. The case centered on the burden of proof required to invalidate a patent, when invalidation is raised as a defense to a claim of infringement. What made this case so important were its far-reaching consequences – not because of the law, but because of the patent involved.

Microsoft publishes a popular word-processing software package known as Microsoft Word – known and used the world over, millions of copies have been sold since its release in the early 1980s. It’s become the gold standard for documents – if you’ve received a document over email in the past decade, chances are it was a .DOC file. The 2007 version of Word included a feature for adding custom XML data and mappings to electronic documents. This allegedly infringed upon a patent owned by Infrastructures for Information (or i4i) – patent number 5,787,449 – and so i4i filed suit.

In response, Microsoft counterclaimed, using i4i’s own software as on-sale evidence that i4i was not entitled to a patent. That is, Microsoft claimed that i4i’s software had been on sale in the U.S. more than one year before the patent was applied for. Because the source code had been destroyed by the time the case came to trial, the only evidence about whether the software practiced the method in the patent was given by the patent’s inventors, who (unsurprisingly) stated that the software did not practice the claimed invention.

Microsoft, undeterred, asked the court to give the jury an instruction that because this software had not been before the patent examiner who examined the patent in question, Microsoft did not need to prove that it could act as an on-sale bar with “clear and convincing evidence” – that is, evidence that is highly and substantially likely to be true. Instead, Microsoft requested that the jury be informed that they only needed to find that the software practiced the patent using a “preponderance of the evidence” standard – a much lower standard, one closer to “51% likely, or more likely than not, to be true.”

The court rejected this approach, and the jury found for i4i. The Federal Circuit affirmed, and Microsoft filed for certiorari to the Supreme Court.

Microsoft’s brief asked two questions. The first was rather straightforward: whether the standard for using invalidity as a defense to infringement is “clear and convincing” or “preponderance of the evidence?” The second was more nuanced – when prior art is being offered to invalidate the patent, and that prior art was not shown to the patent examiner while the patent was undergoing examination, is the standard “clear and convincing” or “preponderance of the evidence?” In this case, because the examiner had not seen or been told about the existence of the software, Microsoft argued that this necessitated a lower standard of proof.

While Chief Justice Roberts recused himself from the case (apparently owing to owning a large amount of Microsoft stock), the other eight justices were completely unconvinced by Microsoft’s arguments, giving an 8-0 win to i4i.

As for the first question, the majority opinion (authored by Sotomayor, and joined by Scalia, Kennedy, Ginsburg, Breyer, Alito, and Kagan) focused on the language in 35 USC § 282 – stating that a “patent shall be presumed valid” and that the “burden of establishing invalidity of a patent…shall rest on the party asserting such invalidity.” The majority opinion then went through an analysis of the history of this section as well as what Congress meant the standard to be, finding that Congress meant this burden to be “heavy.” Reading a line of cases going back to RCA v. U.S. in 1934, the Court reasons that a patent’s validity can only be “overthrown…by clear and cogent evidence.”

As for the second question, the majority opinion notes that until this case, courts applied the “clear and convincing” standard to all evidence – without even considering whether the evidence had been before the Office during examination. The Court acknowledges that while a patent’s presumption of validity can be “weakened” or “dissipated” when certain prior art is not before the Office, it does not lower the standard required to invalidate it.

The Court, in affirming the Federal Circuit’s ruling, upheld an almost 80-year-old-bedrock of patent law. Had Microsoft won, the effects could have been disastrous. In the worst-case scenario, issued patents would have been no more “valid” than patents still in examination. It would also be, to quote i4i’s counsel, a “collateral attack on a government decision.”

I don’t have the entire case file before me. However, knowing what I know about software, it seems as if a decompiler might have been able to produce a little bit more evidence than just the inventors’ “say-so” about the content of the software. It likely wouldn’t be a silver bullet – but it might have been able to prove Microsoft’s case.

One interesting side effect of i4i’s suit is that it directly affected some of Microsoft’s innocent customers. According to i4i’s webpage on the suit, copies of Microsoft Word that were licensed before the injunction happened were able to insert custom XML data into documents, and use that custom XML data in creating applications. Copies of Word that were licensed after the injunction, however, automatically removed all custom XML from documents when they were opened for the first time. So customers who had nothing to do with this suit lost data. Thankfully, i4i was right there to help them get their data back. For the low price of $249.99, customers were able to save the data that i4i’s injunction forced Microsoft to erase.

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