Word and Office Banned From Sale In Weeks As Microsoft Loses Patent Lawsuit [update]

– Update – Microsoft has prepared versions of Office and Word specifically that gut the offensive bits and pieces that were in contention. This version, according to Ed Bott, will ship, and is already filling OEM channels. We had it right – like hell was Office going to stop selling. Read more here.

Sad news for Redmond, they have lost again. In a stunning decision, Microsoft has again lost a lawsuit to i4i over XML handling algorithm abuse.

This means that the as of January 11, Microsoft will be banned from selling Word and the larger office suite. Given that the latest round of MSFT productivity products depend and use the contentious algorithms, Microsoft is running short of options.

What to expect? A large check to be cut. Given that Redmond has now lost twice running, they can either hope for an injunction from a higher court, or buy off the smaller company.

Engadget notes that i4i “isn’t a patent troll — it’s a a 30 person database design company that shipped one of the first XML plugins for Office and was actually responsible for revamping the entire USPTO database around XML to make it compatible with Word back in 2000.” We cannot shrug this off as an abusive lawsuit, it appears to be kosher.

Of course, Microsoft is hardly going to let anything prick their cash-cow that Office is. The chance that they will actually let this go to the point that Office sales are barred, is nearly zero. Also, never underestimate the ability of a company that has billions to turn up the heat legally and crush a small competitor.

It does appear that Microsoft is in the wrong here, and is trying to get away from that. What could this cost? A few hundred million. That’s hardly something to get that riled up over, when you have that 50 times over in the bank. If they cannot get another injunction, Microsoft will just pay.