Microsoft facing $1.5bn patent fine

Microsoft was accused of infringing two patents concerning the way MP3 files are encoded and played back

Microsoft faces a damages bill of $1.52bn following a decision today by a US federal jury in a patent case. If the ruling stands, it will be the largest US patent award ever. 

The decision follows a suit filed in the US District Court in San Diego in which Alcatel-Lucent had claimed that Microsoft infringed on two patents concerning the way MP3 files are encoded and played back. 

Microsoft said that it had licensed the technology from German research group Fraunhofer Gesselschaft, which the company argued is the real owner of the technology. 

In a statement provided to vnunet.com, Microsoft corporate vice president and deputy general counsel Tom Burt called the decision "completely unsupported by the law or the facts" and said that the company will challenge the ruling. 

"We are concerned that this decision opens the door for Alcatel-Lucent to pursue action against hundreds of other companies which purchased the rights to use MP3 technology from Fraunhofer, the industry-recognised rightful licensor," said Burt.

The $1.5bn decision was reportedly reduced from a possible $4.5bn because jurors could not find Microsoft guilty of wilfully violating the patents.

A spokesperson for Alcatel-Lucent told vnunet.com: "We have made strong arguments supporting our view and we are pleased with the court's decision."