Microsoft, Alcatel-Lucent settle long-running patent fight

The companies ask judge to end the case, two months after she ordered Microsoft to pay $26.3 million, for infringing on patents in Outlook and two other products.

Microsoft and Alcatel-Lucent have settled their nearly 9-year-old patent dispute, two months after a federal judge ordered Microsoft to pay $26.3 million in damages to the telecommunications infrastructure company.

Yesterday, the companies asked U.S. District Judge Marilyn Huff in San Diego to grant a joint motion ending all claims in the suit. A Bloomberg article notes that both sides agreed to bear their own costs, according to a court filing. No details were given about settlement terms.

"Microsoft and Lucent have entered into a confidential settlement to the satisfaction of both parties," a Microsoft spokeswoman said.

The patent, originally applied for by engineers at AT&T, from which Lucent sprung, covers a method of entering information into fields on a computer screen without using a keyboard. In 2002, Lucent, since merged with Alcatel, sued PC makers Gateway and Dell for infringement, and Microsoft intervened.

A jury ruled that Microsoft infringed on the patents in its Outlook e-mail software, Windows Mobile, and Microsoft Money programs. In 2009, a federal appeals court affirmed the lower court ruling, but said the jury award of $358 million in damages was excessive . That led to the new trial and a $70 million damage award that Huff reduced to $26.3 million in November.

About the author

Jay Greene, a CNET senior writer, works from Seattle and focuses on investigations and analysis. He's a former Seattle bureau chief for BusinessWeek and author of the book "Design Is How It Works: How the Smartest Companies Turn Products into Icons" (Penguin/Portfolio).


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