Microsoft has been
ordered by a US court to pay $1.52bn (£800m) in damages toAlcatel-Lucent for
violating two MP3 patents.
The patents in question cover the conversion of audio into the
digital MP3 file format on PCs.
In 2003, Lucent, which was acquired by Alcatel last year, filed
15 patent claims against Gateway and Dell for technology developed
by its research arm Bell Labs.
In the same year, Microsoft added itself to the list of
defendants, claiming the patents were closely linked to its Windows
operating system. The PC makers are still fighting the case.
A district court in San Diego has now awarded the damages
against Microsoft to Alcatel-Lucent, but Microsoft said it intends
to appeal.
Microsoft disputes that Alcatel-Lucent's patents govern its MP3
encoding and decoding tools. It says the software used by its
Windows Media Player is licensed from German firm
Fraunhofer-Gesellschaft.
Tom Burt, Microsoft corporate vice president and deputy general
counsel, said, “We think this verdict is completely unsupported by
the law or the facts. We will seek relief from the trial court, and
if necessary appeal.
"Like hundreds of other companies large and small, we believe
that we properly licensed MP3 technology from its industry
recognised licensor – Fraunhofer. The damages award seems
particularly outrageous when you consider we paid Fraunhofer only
$16m to license this technology.”
Burt claimed the verdict opened the door for action to be taken
against a number of other firms who have licensed the same
technology from Fraunhofer.
Those companies include Nokia and Apple.
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