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Record Penalty Against Microsoft Tossed

Ruling overturns jury verdict that would have handed $388 million to Singapore's Uniloc.

A federal judge on Tuesday overturned a jury's finding that Microsoft infringed a patent held by anti-piracy specialist Uniloc and tossed out a record, $388 million damage award that the software maker would have been forced to pay the plaintiff.

"The verdict of the jury is vacated," said a brief notice issued by the U.S. District Court for Rhode Island. Microsoft's appeal was heard by Judge William Smith of the same court.

Not surprisingly, a Microsoft spokesman said, via e-mail late Tuesday, that the company is "pleased that the court has vacated the jury verdict and entered the judgment in favor of Microsoft."

Uniloc, of Singapore, sued Microsoft in federal court in Rhode Island in 2003, claiming that its products were being used illegally in the Windows operating system and the Microsoft Office productivity suite.

Microsoft, along with a number of other tech industry vendors, has called for an overhaul of patent regulations it claims enable frivolous legal actions and excessive awards.

Microsoft has also gone on record in support of the Patent Reform Act of 2009. Among other things, the bill calls for damages in patent cases to be awarded only on the basis of the inventor's specific improvements over prior works, and not on the whole value of the invention itself.

Microsoft earlier this year reached a patent settlement with navigation software developer TomTom. TomTom agreed to make unspecified payments to Microsoft in order to settle Redmond's claims that Linux code used in TomTom's products contained patented Microsoft technology—specifically, the FAT file system.

It was not immediately clear if Uniloc plans to appeal the Rhode Island court's decision to the U.S. Court of Appeals.

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