A Texan judge has ordered Microsoft to stop selling MS Word in US because it infringes on a patent hold by i4i.

i4i, a Toronto based corporation, filed a complaint (PDF) in March 2007 alleging that Microsoft is infringing a patent:

United States Patent No. 5,787,449 (“the ‘449 Patent”) entitled “Method and System for Manipulating the Architecture and the Content of a Document Separately from Each Other,” … issued … on July 28, 1998.

The complaint specifies that Microsoft infringes the patent through

… making, using, selling, offering to sell, and/or importing in or into United States, without authority, Word 2003, Word 2007, NET Framework, and Windows Vista.

Also, Microsoft’s acts are considered deliberate:

Microsoft has knowledge of the ‘449 Patent, and has not ceased its infringing activities. Microsoft’s infringement of the ‘449 Patent has been and continues to be willful and deliberate.

The complaint contains a copy of the ‘449 Patent.

Leonard Davis, a US District Judge, has issued his final judgment (PDF) yesterday (Aug. 11th) finding that:

Defendant Microsoft Corporation (“Microsoft”) is found to have unlawfully infringed U.S. Patent No. 5,787,449 (the “‘449 patent”).

Defendant Microsoft is found to have infringed the ‘449 patent willfully.

The Court awards damages to i4i for Microsoft’s infringement of the ‘449 patent in the amount of $200,000,000.

i4i is further awarded enhanced damages of $40,000,000 for Microsoft’s willful infringement.

i4i is further awarded post-verdict damages of $144,060 per day from May 21, 2009 until the date of this Final Judgment.

i4i is further awarded pre-judgment interest of $37,097,032 up to May 20, 2009 and $21,102 per day thereafter until the date of this Final Judgment.

That is about 290 million dollars and counting. Even more, the injunction (PDF) accompanying the judgment forbids Microsoft to sell Word 2003, Word 2007, and future Word products in US or to use them to “open an XML file containing custom XML,” but allows Microsoft to open XML documents as plain text files. The judge did not mention .NET Framework nor Windows Vista although i4i included those in their complaint.

Kevin Kutz, a spokesman for Microsoft, said

We are disappointed by the court's ruling. We believe the evidence clearly demonstrated that we do not infringe and that the i4i patent is invalid. We will appeal the verdict.

It is clear that Microsoft will appeal the verdict and will probably settle the issue outside the court. It is interesting that i4i makes x4o, an XML authoring tool for MS Word, so it is obviously not interested in killing Word.