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InterTrust Technologies Corporation, a Santa Clara, Calif.-based software company that developed a technology for protecting digital media on the Internet, won a patent Tuesday that it says bolsters its infringement case against Microsoft. Should InterTrust win its case, it could delay the release of Windows XP and cause Microsoft to pay billions of dollars in damages to the Silicon Valley-based company. The patent covers a technology developed by InterTrust that enables digital media to be transferred between devices such as computers, set-top boxes, portable music players and cell phones, in a protected format. The technology gives consumers the freedom to move music or video between devices, while allowing the owner of the copyrights to track that use. InterTrust, which licenses its technology to AOL Time Warner, Blockbuster and Universal Music Group, had been in licensing talks with Microsoft until late last year. The company accuses Microsoft of appropriating proprietary technology from those talks and incorporating it into Windows Media Player 7.0, Windows Millennium Edition and the upcoming Windows XP. “Its no secret that InterTrust had engaged in extensive discussions with Microsoft,” says InterTrust president Ed Fish. “When Windows Media Player 7.0 came out, we went to [Microsoft's] Web site, where they put up a lot of information on how it works. Then we got our technical people and attorneys to do a side-by-side comparison.” InterTrust’s infringement claim focuses specifically on the digital rights management technologies in Windows Media Player, but it also extends to Windows operating systems that come with the player built in. The integration of digital rights management technology is central to Microsoft’s much-touted .Net and HailStorm initiatives, which seek to further integrate Internet-based media into the Windows XP desktop. Microsoft spokesman Jim Cullinan says that the Redmond, Wash.-based company has not yet seen the new patent and that it has not received an amended complaint from InterTrust. He maintains that Microsoft, a company based on intellectual property, respects the intellectual property of others. “It’s clear to us this is the tactic of a desperate company in financial trouble,” Cullinan says. InterTrust, a pioneer in the field of digital rights management since the company was founded 11 years ago, had revenue of $7.9 million but lost $55.6 million last year. Its once high-flying stock is trading at just over a dollar. Martin Adelman, director of the Intellectual Property Program at George Washington University in Washington, D.C., says that InterTrust has been very conscientious in attaining solid patents for its technologies. He says that even weak patents can sometimes lead to injunctions and massive judgments, and that this means InterTrust will have to prove that its patents are “commercially important.” “In a couple of years Microsoft may have to pay a billion or two,” Adelman says. “If it’s commercially important, Microsoft is going to have to deal with it.” Related Articles from The Industry Standard: The Outer Limits of Interactive TV AOL and AT&T Wireless Expand Their Wireless Data Pact Napster’s British Invasion Copyright � 2001 The Industry Standard

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