Plaintiff i4i sued Microsoft in March 2007 claiming that it violated a 1998 software patent (number 5,787,449) for a document system that eliminated the need for manually embedded formatting codes. One of the fundamental features of the markup language XML is that it is readable by both people and machines. XML allows developers and users to define their own tags for data - unlike other markup languages like HTML which have predefined tags.
Microsoft has already paid $200 million after a federal jury ruled that the XML properties of Word 2003 and Word 2007 infringed on i4i's patent. Redmond accumulated another $77 million in fees after the most recent ruling, $40 million for willful patent infringement and $37 million in prejudgment interest. The company must comply within 60 days and is planning to appeal the verdict.