Microsoft Faces Lawsuit Over Caller ID for E-Mail

A new patent battle is brewing — this time over Microsoft’s claim over Caller ID for E-Mail.

F. Scott Deaver, owner of Failsafe Designs, says Microsoft is guilty of the “outright theft” of his product name and intellectual property (IP), and will seek legal and financial redress from the Redmond, Wash., software giant and anyone else that uses his technology that verifies e-mail is coming from the domain it claims.

If that happens, it’s sure to put a monkey wrench in the deployment of the Sender ID specification, which is a combination of Microsoft’s Caller ID for E-Mail specification and the Sender Policy Framework (SPF), worldwide to combat one of the avenues used by spammers.

The technology used in Caller ID for E-Mail is part of a specification called Sender ID currently under review by an Internet Engineering Task Force (IETF) working group as a proposed Internet standard to eliminate the use of spoofed e-mail addresses found in many of today’s spam messages.

Deaver has been the registered owner of for almost two years, and has in that time developed beta versions of a software application called Caller ID for E-Mail, an e-mail validation program that works in, ironically, Outlook Express — a Microsoft product.

Currently his trademark application (filed in March 6, 2003) for the term, “Caller ID for E-Mail” is pending approval at the U.S. Patent and Trademark Office (USPTO), and Deaver said in an e-mail interview he has substantive and numerous registered patents on file dated January 2003 and 2004 at the USPTO on software that predates and precedes any other claims.

Microsoft officials refused to comment on Deaver’s claims.

The first time many people heard about Caller ID for E-Mail was when Bill Gates, Microsoft co-founder and chief software architect, first announced his company’s new anti-spam initiative in February., Sendmail and Brightmail were brought on board to help with Caller ID for E-Mail field tests on Microsoft’s Hotmail service.

Deaver has a blistering version of his side of the story on his Web sites, taking Gates and Microsoft to task for stealing his ideas and work. On it, he described his pending patent and trademark applications, as well as personal comments on IP the company has subverted in the past. Microsoft is “absolutely desperate to appear relevant in the struggle against spam,” one passage states.

“That page was in reaction to watching years of un-rewarded effort go down the drain in a single event,” he said.

Unfortunately for Deaver, finding a lawyer to take on Microsoft without approved patents from the USPTO is next to impossible. Deaver said that many of the lawyers he has contacted are “begging” to have a chance to take a crack at the case — after the patent is issued.

Even then, he and whatever lawyer he signs aboard will have a difficult time proving Microsoft stole his technology. Lloyd Smith, a partner at Burnes, Doane, Swecker & Mathis, LLP, has represented several defendants against large corporations who were infringing on patents or trademarks.

Smith said Microsoft’s lawyers, if the case ever gets to trial, will immediately try to determine whether Deaver’s patents were actually infringed upon by Microsoft’s Caller ID for E-Mail technology. The Redmond lawyers are sure to argue Microsoft’s technology is different enough to fall outside the scope of Deaver’s patents. They’re also going to attack the validity of the patents themselves.

“Even though you have a patent [in the USPTO] doesn’t mean that the court can’t invalidate it when you go into court,” Smith said. “Good lawyers always go after the validity of that patent and try to get it invalidated for a host of reasons; the most common that someone has already invented it and the patent shouldn’t have been issued in the first place.”

Deaver’s strategy doesn’t involve going after Microsoft immediately, however, but going after smaller partners and building up a war chest from the proceeds garnered by those infringement cases.

“Really, it seems to come down to this: anyone using my work or ideas without compensation is fair game,” he said. “I am not comfortable with that approach, but that is both the letter and intent of applicable law. This naive belief that some day Bill Gates is going to walk up to my door and say, ‘oops, I accidentally stole your product ideas along with your product name and I want to make it right,’ ain’t gonna happen.”

Smith said Deaver might be better off taking a settlement, if one is offered. Trying to predict an outcome if the case goes to a jury — without seeing the patent claims and Microsoft’s product — makes it hard to determine, though it would be an extremely tough case for Deaver to win regardless of the claim’s strength.

“Given Microsoft’s tremendous resources and history of defending its position vigorously, Mr. Deaver is better off if he can strike some kind of commercially reasonable deal with Microsoft, rather than risking the expense and uncertainty of a trial where he may come away with nothing,” he said.

Until that time comes, Deaver will continue to market his software. Right now, he’s in China working with business and government leaders to distribute his core e-mail sender identification and verification specification — always intended for open source distribution under a GNU-style license, he said — on Linux operating systems in the country, then selling his proprietary applications at cost.

“This was my ultimate resolution to solving the dilemma I faced stuck in a cage with the 800-pound gorilla named Microsoft — I am making nice with a much bigger gorilla!” he said.

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