MicroStrategy Defeats Patent-Infringement Suit

MicroStrategy Inc. has defeated a $100 million patent-infringement lawsuit brought by rival Business Objects SA, one of several such lawsuits that vendors in the increasingly competitive business-intelligence software industry have filed against each other.

The U.S. District Court for the Northern District of California on Aug. 29 issued a summary judgment--a ruling issued prior to a jury trial--that Business Objects' claims were unsupported and that MicroStrategy had not infringed on a Business Objects patent. The court dismissed the suit "with prejudice," meaning that Business Objects can't refile the suit. MicroStrategy disclosed the ruling late Tuesday.

Business Objects filed the lawsuit in 2001, charging that MicroStrategy had violated a patent Business Objects holds on a "relational database access system using semantically dynamic objects," a means of accessing data in a relational database.

The ruling confirms that there are substantial differences between MicroStrategy's technology and the concepts embodied in Business Objects' products and its patent, says Jonathan Klein, MicroStrategy's law VP and general counsel. Business Objects filed for the patent in 1991 and was awarded it in 1996. A Business Objects spokesman says the company disagrees with the court's decision and is considering an appeal.

Business Objects also sued Cognos Inc. and Brio Technology Inc. for patent infringement concerning the same patent. Those vendors settled the litigation out of court: Brio in 1999 for $10 million and Cognos last year for $24 million.

The business-intelligence industry at times appears as litigious as it is competitive. MicroStrategy has its own lawsuit pending against Business Objects for patent infringement, misappropriation of trade secrets, and tortious interference with contractual relations. That case could go to trial as early as this fall, Klein says. In June, Actuate Corp. defeated a MicroStrategy lawsuit charging it with misappropriating trade secrets.