Microsoft Holds Off on Eolas-Related Changes To Windows and Internet Explorer

REDMOND, Wash., Jan. 29, 2004 — Microsoft Corp. today announced that it will not, for now, implement modifications to its Windows® operating system or Microsoft® Internet Explorer as a result of the Eolas patent lawsuit. Given the present legal status as well as requests made by partners and customers, Microsoft will, for the time being, not move ahead with the modest steps it intended to take to modify Windows and Internet Explorer as a result of the August jury decision in the Eolas patent lawsuit.

Microsoft announced in October that it was considering minor changes that would allow Web developers and others who use Internet Explorer technology to avoid any concern of infringement. Microsoft also indicated that these steps would be made in new versions of Windows that were shipping this year.

Earlier this month, the district court entered its final judgment in the Eolas case, and Microsoft intends to appeal. The court stayed the judgment, including implementation of an injunction, until the appeal has been heard and decided.

Eolas Technologies Inc. is the exclusive licensee of a patent owned by the University of California. In the case, Eolas asserted that the patent covered a mechanism used by Web page authors to embed and automatically invoke certain interactive programs. Although Microsoft asserted that the patent was invalid due to pre-existing inventions, the court refused to let the jury consider the prior art. The jury rendered its verdict on Aug. 11, 2003.

Independent of the actions of the trial court in the Eolas lawsuit, the Commissioner of the Patent Office has announced that the Patent Office has determined that there are substantial questions concerning the validity of the Eolas patent. The action by the Patent Office may result in the cancellation of the Eolas patent. Given these circumstances, and after consulting industry colleagues and developers, Microsoft, for now, will not be releasing an update to Internet Explorer and does not plan on making the changes it announced in October to Windows XP Service Pack 2.

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