The US Supreme Court on Monday rejected Microsoft's appeal of the jury verdict in the Alcatel-Lucent patent case. Alcatel-Lucent has been awarded various amounts in the case, but that is currently under review.
For background, Alcatel-Lucent is a corporate descendent of AT&T's Bell Labs unit. It became Lucent Technologies when it was first spun off, and then Alcatel-Lucent when it merged with Alcatel SA. While named Lucent, the company began suing high tech firms for violating various technologies, including the MP3 audio codec, of which AT&T was a part owner. (Yes, this gets complicated.)
Alcatel-Lucent first sued PC makers Dell and Gateway in 2002 for using its technologies in their PCs, and Microsoft quickly entered the case because its Windows products, used by the PC makers, were accused of violating Alcatel-Lucent patents. Microsoft counter sued, offering up its own patent violations against Alcatel-Lucent, and Alcatel-Lucent expanded the case to include other Microsoft products, like Outlook.
In February 2006, a jury decided that Microsoft should pay $1.52 billion for violating Alcatel-Lucent's patents, which at the time was the largest patent verdict in US history. Microsoft appealed, and in September 2009, a US federal appeals court upheld the lower-court ruling but struck down the damages reward, which had been adjusted to $358 million. Microsoft had suggested a damages payment of $6.5 million. But now the case will head back to court, starting December 3.