Microsoft, Eolas Settle: It's Still Cheaper To Pay Up Than Fight Bogus Patents

from the such-is-life dept

Microsoft and Eolas have been involved in a patent infringement lawsuit for many years. Eolas claims a patent on the concept of embedding other applications within browsers -- basically for the concept of plugins. This patent was questioned by many people who note that plugins are a pretty common concept and it hardly seems reasonable to give a monopoly over that idea to one company. In fact, none other than web inventor Tim Berners-Lee showed prior art for browser plugins, and the Patent Office suddenly started saying that it may have made a mistake in granting Eolas the patent. Unfortunately, due to the ridiculously complicated process to get the USPTO to review a patent, it was eventually ruled that the patent could be valid. However, it recently had agreed to review the patent again.

Of course, as we've learned time and time again, since this process is so long, and the risk of losing gets costlier and costlier the longer you wait, it appears Microsoft has given up invalidating this highly questionable patent and has simply paid off Eolas in a settlement. The amount isn't defined, but Eolas is gleefully telling its shareholders to expect a dividend shortly. Once again, this highlights nearly everything wrong with the patent system and why it needs to be changed. A very broad and vague concept with plenty of prior art gets patented by a small firm that doesn't actually do anything. Then it holds up a large company that is actually offering a product to the market, and forces them to change their product, taking away functionality, while trying to collect hundreds of millions of dollars that could have gone towards further innovation. On top of that, it highlights how difficult, slow and convoluted the patent review process is that makes it so difficult to actually contest these questionable patents. In the end, it's often just cheaper to pay up, diverting money from actual innovation into the legal system. What a shame.

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  1. identicon
    davidm, 30 Aug 2007 @ 7:54pm

    or else

    if you own a patent, you want to sue a large company. once they pay up, the patent is validated, and the patent owner's claims are stronger in court. this is also a win for the company that caves (MS in this case); there may even have been some sleazy back room agreement. they now own the right to use a 'proven patented technology,' while others will have to go through the pain and suffering or perhaps get shut down.

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