Another Eolas Re-Exam Request

One of Microsoft’s lead intellectual property law firms has asked the United States Patent & Trademark Office to open a new reexamination of the Eolas patent.

The Eolas patent covers “a system allowing a user of a browser program on a computer connected to an open distributed hypermedia system to access and execute an embedded program object.”

Eolas Technologies, the tiny University of California spin-off that received U.S. Patent No. 5,838,906 in 1998, claims that it covers plug-ins, Java applets, scriptlets and Microsoft’s ActiveX Controls.

The new request for re-examination filed by attorneys at Klarquist Sparkman claims, “The patent owner has compromised the pending Director-instituted reexamination of the ‘906 patent … by failing to tell the Examiner about prior art in its possession that would have materially changed the prior art landscape in front of the Examiner.”

Klarquist Sparkman has served as patent prosecution and litigation counsel for Microsoft since 1991, and is one of its preferred legal counsels for intellectual property matters. Neither Kyle Rinehart nor Stephen Wight, the attorneys who signed the request, responded to calls or e-mails asking whether the request was made at Microsoft’s behest. Microsoft refused to comment.

University of California (UC) spokesman Trey Davis said, “We are monitoring the situation, but we do not believe there is any new issue to consider. The PTO had the message boards two years ago as part of evidence submitted for the recent reexamination, which reaffirmed the validity of UC’s patent.”

The Eolas inventors, Michael Doyle, David Martin and Cheong Ang, assigned their interest in the patent to the University of California in November 1994 and then licensed it back.

A previous reexamination was completed in September, when the patent office notified Eolas that it planned to uphold the patent. Davis said UC had not received the certificate.

In December, Microsoft changed the way its Internet Explorer browser handles ActiveX Controls in order to eliminate the alleged infringement.

Because the patent covers a way of automatically launching a plug-in, IE users now will have to click once to authorize their launch.

The company held a briefing for around 20 large Web publishers and interactive advertising agencies to show them how to author pages so that this click wouldn’t be required.

Steven Frank, an intellectual property specialist with the law firm of Goodwin Procter, noted that Klarquist requested an ex parte reexamination, which means that the process would take place without participation from the firm.

In ex parte proceedings, he said, “The true party of interest doesn’t have to declare itself. You can hide behind your lawyer. You tell your lawyer to throw the grenade in the room, and you can stay safely out of range.”

The previous re-examination began in October 2003, following a petition by the World Wide Web Consortium offering evidence of prior art in the form of early e-mails by Dave Raggett, who led the W3C’s early HTML specification work.

Klarquist’s re-examination request adds what it says is a public posting by Bill Janssen that it said “fills in the gaps the Examiner noted” in one of the Raggett e-mails by describing a technique for invoking interactive programs.

Moreover, it said, the posting anticipates two of the claims of the Eolas patent, while making obvious the rest. (A concept can’t be patented if it would have been obvious to others working with similar technology.)

Microsoft and Eolas are wrapped up in litigation that began in February 1999 with a patent infringement suit filed by Eolas, alleging that Microsoft’s ActiveX infringed the patent. Microsoft lost the first round, and was slapped with a $520.5 million judgment.

On appeal, the Circuit Court upheld the lower court’s interpretation of the Eolas patent on browser plug-ins, but said the jury in the Eolas patent infringement suit against Microsoft should have considered whether the patent itself is valid.

The case was sent back for another trial on that issue, with a pre-trial hearing set for January 18.

Frank said that Klarquist is trying to convince the patent office that the new evidence is important enough to undertake still another reexamination.

At the same time, Microsoft may hope to delay or influence the new patent infringement litigation. While a patent holder has the same duty of disclosing any prior art it knows of during a reexamination as during the application process, he said, “The question of whether you fulfilled your duty can only be resolved in court.”

The USPTO issued a statement saying a decision on Klarquist’s new reexamination request would be made within three months of the Dec. 22, 2005 filing date.

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