Microsoft knew of the patent held by i4i as early as 2001, but instead set out to make the Canadian developer's software "obsolete" by adding a feature to Word, according to court documents.
The patent infringement case brought by Toronto-based i4i resulted in a $290 million (£175 million) judgment against Microsoft, and an injunction that bars Microsoft from selling Word 2003, Word 2007 and Word for Mac 2008 in their current forms.
In a 65-page summary opinion dated 11 August, US District Court Judge Leonard Davis said that evidence presented during the May 2009 jury trial showed Microsoft had met with i4i executives as far back as 2001, knew of the firm's patent for XML editing, and yet did nothing to guarantee that its implementation of "custom" XML would not infringe the i4i patent.
Davis highlighted an internal Microsoft email that was presented by i4i during the trial as "particularly damaging." The email was sent by Martin Sawicki, a member of the XML for Word development team, as a reply to another Microsoft employee who forwarded a message from i4i that described both its software and patent.
"We saw [i4i's products] some time ago, and met its creators," said Sawicki in the Jan. 23, 2003, e-mail. "Word 11 will make it obsolete. It looks great for XP though." Word 11 was the in-development code name for what was eventually dubbed Word 2003.
"The trial evidence revealed that Microsoft's intention to move competitors' XML products to obsolescence was quite bold," Davis said in his opinion. During the trial, i4i's expert testified that 80 percent of the market for the company's products was made moot when Microsoft added custom XML capabilities to Word 2003.
"My main concern with i4i is that if we do the work properly, there won't be a need for their product," stated another internal Microsoft e-mail submitted into evidence.
Last May, a Texas jury awarded i4i $200 million in damages for Microsoft's patent infringement. Davis added another $40 million in "enhanced damages" for Microsoft's "wilful infringement," and additional damages and interest that brought the total to $290.6 million.
Davis slapped an injunction on Microsoft that blocks it from selling Word 2003, Word 2007, Word 2008 for Mac, and when it's released, Word 2010, unless the company changes or removes the word processing programs' custom XML feature. Microsoft has until 20 October to comply.
Microsoft said last week that it will appeal the verdict and the injunction. The company has not yet filed an appeal with the US Court of Appeals for the Fifth Circuit.
This is not the first time that Office file formats have been taken to task. Two weeks ago, Microsoft said it would add a file format "ballot" to Office 2010 as part of a campaign of concessions to ward off European Union (EU) antitrust regulators.