Federal judge rules in favor of Microsoft in 2004 video game patent lawsuit

In 2004, several Michigan inventors sued Microsoft and Sony asserting U.S. Patent #5,292,125 an “apparatus and method for electrically connecting remotely located video games.”  Specifically targeted were Microsoft’s Xbox Live service and Sony’s Playstation Network.  The allegations were that the companies infringed the plaintiff’s patents seeking an injunction and royalties.

The patent discloses “a video game communication assembly for communicating command signals between a local video game and at least one remote video game.”  Unlike Microsoft who decided to challenge the substance of the argument raised by the patent holders, Sony settled out of court for an undisclosed sum in 2009.

The decision to settle was unfortunate for Sony because last week, U.S. District Court Judge Paul Borman ruled in favor of the remaining defendant Microsoft, dismissing the plaintiff’s challenges and permitting Microsoft to recover legal fees from the plaintiffs.  In the opinion, Borman questioned the interpretation of  “electrical connection” given that the Xbox didn’t use an electrical connection to communicate between players.  Although the Xbox Live network utilized electrical signals, the Judge found that the technology in question didn’t rely on an “electrical connection” as described by the patent.  Had the game systems connected via an electric connection (which most systems don’t), the decision may have easily gone the other way.

The lesson to take from the events of last week is if you are Sony not to settle when you have a good legal argument.  If you are Microsoft, the lesson is if you have a good argument, keep arguing it, it may end up more profitable than settling.  When litigating a complex patent, it is difficult to receive quality advice without a good patent attorney on your side.  The lawyers at the law firm of Wessels & Arsenault can provide such sound advice if you are facing possible or actual patent litigation.

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