The injunction (PDF), which becomes effective in 60 days, prohibits Microsoft from selling future Word products that allegedly use the patented technology. It also enjoins Microsoft from testing, demonstrating, marketing or offering support for those future products.
Davis also ordered Microsoft to pay i4i more than $290 million in damages.
Large corporations like Microsoft like software patents because they are a barrier to entrance for new corporations. Large companies can cross-license with each other. Small companies, meanwhile, don't have their own patent portfolio, so they can be sued out of existence. Occasionally the tables are turned, as in this case, but apparently Microsoft still thinks it's worth it, at least as of 2007.
From all other perspectives than that of the largest software companies, software patents are failing. The above patent should have never been granted. Worse, a company with the legal resources of Microsoft should have had no trouble proving prior art and overturning the patent. As much as I relish the irony of this case, it isn't just, and I hope it is overturned on appeal. There is no sense that i4i's inventions are being protected. It's simply legal warfare.
I should write more about software patents. As a place to start, the meandering manifesto of the League for Programming Freedom has several highlights that have influenced me.
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