msnbc.com staff and news service reports
updated 8/12/2009 8:07:22 PM ET 2009-08-13T00:07:22

A federal judge has ordered Microsoft to stop selling some versions of its Word document creation program in the United States, ruling that the program uses technology that infringes on a patent held by a Canadian company. The decision takes effect within 60 days from the ruling. (Msnbc.com is a joint venture of Microsoft and NBC Universal.)

The software giant also must pay $290 million in damages to Toronto-based firm i4i, said Judge Leonard Davis of the U.S. District Court for the Eastern District of Texas. The original verdict in the jury case was in May, with a final judgment rendered Tuesday.

"We are disappointed by the court’s ruling," said Kevin Kutz, Microsoft's director of public affairs. "We believe the evidence clearly demonstrated that we do not infringe and that the i4i patent is invalid. We will appeal the verdict."

Michel Vulpe, founder of Toronto-based i4i and inventor of the disputed patent said, "We are very pleased with the terms of the final judgment. ... We feel vindicated with this result."

The company describes itself as "a world leader in the design and development of XML-based collaborative content solutions and technologies."

Word is the most widely used word-processing program by businesses and home users around the world. At issue is a feature in Word 2003 and Word 2007 that lets users create custom XML documents. XML, or Extensible Markup Language, is similar to HTML, the "language" of the Web.

The judge makes exceptions for versions of Word that remove certain custom code before opening a file, leaving the door open for Microsoft to come up with a technical workaround to the injunction.

The Canadian company said that in 2003, Microsoft introduced a version of Word with XML editing capabilities, as well as in Word 2007 using i4i's "449 patent" for processing XML documents.

"If they (Microsoft) decide to appeal, we will certainly follow it carefully and we will continue down the path to ensure that the judgment is upheld," said i4i Chairman Loudon Owen.

Reuters and The Associated Press contributed to this report.

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