Microsoft, HP, IBM safe from Kodak software patent

Though a Friday patent lawsuit verdict against Sun Microsystems Inc. could potentially have a wide-ranging impact on the computer industry, the ruling appears unlikely to affect three of the world's largest IT companies, who have licensed the technology in question. Hewlett-Packard Co., IBM Corp. and Microsoft Corp. are licensees of the software patents in question, the patents' owner, Eastman Kodak Co., confirmed Monday.

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On Friday, a federal jury in New York ruled Friday that Sun's Java technology violated several Kodak patents, setting the stage for a damages ruling against Sun that could cost the Santa Clara, California, computer maker as much as $1.06 billion, which is the amount being sought by Kodak.

The ruling immediately raised questions about whether Kodak's patent claims could affect other IT vendors.

Some of Kodak's patents are so broadly stated that they could possibly cover technologies as varied as the Windows operating system, the Microsoft .Net platform, or even IBM's DB2 database, said Jonathan Eunice, an analyst with Illuminata Inc. in Nashua, New Hampshire.

Kodak's patents, developed by Wang Laboratories Inc.'s imaging software unit before it was purchased by Kodak in 1997, essentially cover a technique for allowing two pieces of software to agree how to interoperate -- a key concept in object-oriented programming that dates back before the patents were filed to the Simula computer language, created in the 1960s, Eunice said.

"This is one of the things when you hit your head and say how can this possibly be valid," he said. "If Java does these things and infringes, then what doesn't."

Java developer Adam Baker agreed with Eunice that the techniques covered in Kodak's patents were developed years before the patents themselves were issued.

"I'd be surprised if either via the appeals process or a separate application to the patent office, the (patents don't) get rejected although these things are never certain," said Baker, a senior consultant engineer in the U.K., who asked that his employer's name not be published.

"I think some serious overhaul of the patents system is required to avoid patents on trivial intentions, which would probably stop most, if not all, software patents," Baker said in an interview via instant messaging.

Though industry analysts like Eunice had initially speculated that Microsoft could be vulnerable to a similar lawsuit over the techniques used by its .Net platform, that scenario now does not appear to be likely. Microsoft, IBM and HP are all licensees of the patents involved in the Sun litigation, said Jim Blamphin, a spokesman for Kodak.

The patents in question are U.S. Patent & Trademark Office patents numbered 5226161, 5206951, and 5421012, Blamphin said.

Blamphin declined to comment on any plans for future litigation, or whether Kodak was actually using the patented technologies in question. "We're just not talking about it now because it is still a matter under litigation," he said.

Kodak did release a short statement about the case, which said that the company was pleased that the court had validated Kodak's intellectual property rights.

Sun issued a statement saying it was "disappointed with the federal jury's decision," and that it was examining options as the jury begins the "liability phase" of the trial, where it will consider Kodak's billion dollar damage request.

One likely outcome would be for Sun to join HP, IBM, and Microsoft and simply license the technology, said Jeffrey Neuberger, a partner with Brown Raysman Millstein Felder & Steiner LLP in New York. "Once the jury's verdict is in, more often than not the case is ultimately settled with the jury's verdict being a factor in the settlement," he said.

A second option would be an appeal of the ruling, which would stand a good chance of being overturned, according to Dan Ravicher, executive director of The Public Patent Foundation in New York. Software patent case decisions are reversed "about half the time" in appellate court, he said. "In the patent world, the chance of reversals are so high, that having a trial verdict doesn't leave you with the ability to predict the outcome of a case."

Coincidentally, Jonathan Schwartz, Sun's President and chief operating officer, had commented on the role of intellectual property (IP) in his company's business a day before the Kodak verdict. In a Web log posting entitled "I Believe in IP," Schwartz wrote that intellectual property is "the foundation of world economies, and certainly the foundation upon which Sun Microsystems was built. Copyright, trademark, patent - I believe in them all."

Following Friday's verdict, Sun executives may now be more aware of the flaws in the U.S. patent system, Ravicher said. "Sun is seeing first hand... how the patent system can have negative impact on technology," he said.

HP, IBM, and Microsoft were unable to comment on this story by press time.

(Infoworld's Paul Krill contributed to this story)