In a decision that has sweeping ramifications for the computer industry, the United States Patent and Trademark Office (USPTO) preliminarily rejected Eolas Technologies' controversial Web browser add-on patent, setting the stage for a reversal of the company's $521 million award in its legal case against Microsoft. On the strength of its now-rejected patent, Eolas had sued Microsoft, accusing the software giant of infringing on Eolas's patented technologies when Microsoft added plug-in capabilities to Microsoft Internet Explorer (IE). Eolas allegedly had planned to sue other browser makers if its lawsuit against Microsoft concluded positively.
And then came the challenges. Citing numerous and obvious cases of prior art, various Web authorities petitioned the USPTO to reconsider Eolas's patent, and in December, the agency announced that it would review the patent's legitimacy. Because of the strength of the evidence presented in those challenges, Microsoft announced last month that the company would no longer make the minor changes to IE that it had been planning as a result of the Eolas lawsuit.
Eolas has 60 days to appeal the USPTO's findings. When and if the Board of Patent Appeals and Interferences (BPAI) makes a final decision regarding the invalidity of the Eolas patent, Microsoft can simply ask the appeals court to reverse the Illinois jury's earlier award against the company.
Microsoft quickly praised the USPTO's patent rejection. "[The USPTO's] decision concerning the Eolas patent is just one step in [its] review process but clearly a positive step," a Microsoft spokesperson said. "This decision, while welcome, is not surprising. We have maintained all along that, when scrutinized closely, this patent would be ruled invalid."
Predictably, Eolas wasn't as excited about the prior-art challenge. "The art that's now complained of was introduced at trial, and it wasn't very persuasive," an Eolas lawyer noted.