Microsoft appeals Eolas decision

The 174-page document, filed June 3, attacks a U.S. District Court decision that said Microsoft violated a patent, owned by the University of California and its Eolas spinoff. The patent describes how a Web browser can run plug-in applications.

The August decision originally granted the University of California and Eolas $1.47 for each of the 354 million copies of the Windows operating system that included the Internet Explorer browser between Nov. 17, 1998, when the patent was issued, and Sept. 30, 2001. In January, the court added $45.3 million in prejudgment interest, increasing the already staggering $521 million award to more than $565 million.

Microsoft's Eolas woes have shaken the Web, drawing former adversaries to the software giant's defense. Web developers and standards advocates fear that if the district court judgment is upheld, Microsoft will rewrite its Web browser in a way that will render millions of Web pages obsolete.

Microsoft filed its appeal, as the U.S. Patent and Trademark Office is pursuing a re-examination of the UC patent. A preliminary finding issued in February by the patent office concurred with claims by standards body the World Wide Web Consortium and others that the patent was improperly granted because of pre-existing similar inventions, or "prior art," by software developer Dave Raggett.

The University of California and Eolas contested that finding three weeks ago.

While the best-case scenario for Microsoft and its supporters is for the patent office to revoke the patent, re-examinations can drag on for years.

Instead of waiting for that outcome, Microsoft has taken its legal fight to the U.S. Court of Appeals. The company said the district court erred in limiting evidence about the "Viola" browser by software developer and artist Pei Wei, a browser the company claimed in trial constitutes prior art.

"Microsoft respectfully contends that the district court erred multiple times on issues related to prior art and claim construction and the defense based on the inventors' fraud on the patent office, and that the court's errors fundamentally and profoundly distorted the proceedings," Microsoft spokesman Jim Desler said. "The jury should be given the opportunity to consider the prior art that was improperly excluded."

Microsoft's brief does not mention the Raggett software, the basis of the patent office's prior-art investigation. That, Desler said, is because Microsoft focused on Viola before the district court.

In its brief, Microsoft asked that the infringement judgment be reversed. Short of that, the company asked the court to vacate the verdict and grant a new trial. Microsoft also asked that the court ignore non-U.S. Windows sales in determining a fine, which would result in a 64 percent reduction of the $521 million award to $187 million.

The University of California said it will file its response to the brief by its July 16 deadline and said Microsoft's arguments are nothing new.

"The contents of the appeal were what we expected," university spokesman Trey Davis said.