A US appeals court restored a verdict that found Microsoft infringed on a patent for an anti-piracy technology owned by a competitor, Uniloc USA. But the court did not reaffirm a 388-million-dollar jury award.
The US Court of Appeals for the Federal Circuit overruled the decision of a lower court judge who threw out a jury's guilty verdict against Microsoft in September.
At the same time, it found that the method the jury used to calculate Uniloc's damages, known as the "25 percent rule," was "fundamentally flawed."
Jury's often estimate a plaintiff's losses as being 25 percent of the expected profits of the product containing the patented technology.
But in its 59-page opinion, the appeals court ruled that was insufficient to establish a reasonable royalty for the technology's use.
The court said a new trial would be required to establish damages and interest due Uniloc.
Uniloc, which makes security software, called the ruling a "significant victory" in its eight-year-old suit against Microsoft over an anti-piracy system used in its Windows XP and Office XP products.
"We are very pleased with the ruling by the US Court of Appeals for the Federal Circuit," Uniloc CEO Brad Davis said.
"This decision illustrates how large corporations, like Microsoft, have knowingly infringed on our technology for financial gain. We are proud of the work that we have accomplished since our founding and will continue to vigorously defend our existing and future innovations."
Explore further: Court Denies Vonage Bid for Patent Case Retrial