Microsoft to pay $200 million in patent dispute

By on May 17, 2010, 11:54 AM
Microsoft has agreed to pay $200 million to settle a long-running patent infringement case over the use of VirnetX's virtual private networking (VPN) technology on the software giant's products. That amount represents a substantial markup from the $105.7 million legal judgment initially leveled against Microsoft in the case, back in March.

VirnetX sued Microsoft in 2007, claiming the company was using its VPN patents without paying for their use. Infringing products included Windows XP, Vista and Server 2003, as well as Microsoft's Live Communications Server, Windows Messenger, Office Communicator and various versions of Office. After winning a first round in that case, VirnetX filed an additional suit, claiming Windows 7 and Server 2008 R2 also infringed on its networking patents.

As part of the settlement, Microsoft will obtain a license to use VirnetX technology in its products. Interestingly, the law firm representing VirnetX was the same that represented i4i in a patent infringement case which netted them a $200 million verdict against Microsoft and an injunction on sales of their Office products. Judge Leonard Davis, the same judge who presided over the i4i case, was the judge overseeing the VirnetX case as well.

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