John Paczkowski

Recent Posts by John Paczkowski

That Extra $1.5 Billion Will Just About Cover the Cost of Those Xbox 360 Repairs

athrimage.jpgAlcatel-Lucent’s astonishing $1.52 billion jury verdict against Microsoft would have done much to bolster the company’s sagging fortunes. But the Franco-American telecommunications equipment maker is going to have to look elsewhere for financial solace.

Finding that a jury’s decision was “against the clear weight of the evidence,” a federal judge yesterday overturned the February verdict that found Microsoft to have infringed upon two of Alcatel-Lucent’s digital music patents. The judge ruled that it doesn’t hold the rights to one disputed patent and hadn’t proved that Microsoft’s programs were using the technology in the other.

The decision is quite a win for Microsoft, which licensed the technology at issue in the case from its rightful licenser–German firm Fraunhofer–and was understandably a bit incredulous when Alcatel-Lucent sued it and won. “Today’s ruling by the judge reversing the jury’s $1.52 billion verdict against Microsoft is a victory for consumers of digital music and a triumph for common sense in the patent system,” Microsoft said in a statement. “For the hundreds of companies large and small that rely on MP3 technology, the Court’s ruling clarifies that these companies have properly licensed the technology embodied in the ‘080 patent from its co-owner and industry recognized MP3 licenser–Fraunhofer.”

For Alcatel-Lucent, of course, it’s a different story entirely. It’s lost not just the $1.52 billion jury verdict, but the supplemental damages and prejudgment and postjudgment interest it was suing Microsoft for as well. “The reversal of the judge’s own pretrial and posttrial rulings is shocking and disturbing,” said Alcatel-Lucent spokeswoman Mary Ward, who noted the company plans to appeal. “The jury unanimously agreed with us. We believe their decision should stand.”

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