May 9, 2008 10:20 AM PDT

Appeals court issues split ruling in Alcatel-Lucent patent case

Posted by Dawn Kawamoto

A federal appeals court issued a split ruling on Alcatel-Lucent's patent infringement lawsuit against Microsoft and Dell.

The U.S. Court of Appeals on Thursday issued a ruling Thursday that kicks one of Alcatel-Lucent's claims back down to the lower courts for further review. This particular allegation centers on a communications protocol (Ackerman, or 131) patent designed to allow a host computer to communicate with a "terminal device."

The appeals court, in remanding the case back to the lower courts, said the lower court erred in its construction of the term "terminal device."

The appeals court, however, sided with the lower court's ruling on Alcatel-Lucent's digital speech compression (Atal, or 954) patent. The technology is designed to produce natural sounding speech at lower bit rates.

According to the ruling, the appeals court found the lower court was correct in its construction of the phrase "each successive iteration including the steps of."

"We are very pleased with the court's decision on the Ackerman patent and respect its decision on the Atal patent. And we appreciate the careful attention the court paid to our appeal," said Mary Lou Ambrus, an Alcatel-Lucent spokeswoman.

Microsoft, meanwhile, also considers the court ruling a victory.

"We are gratified that the Federal Circuit affirmed the lower court's ruling that speech coding technology in Microsoft's products did not infringe the '954 patent," said David Bowermaster, a Microsoft spokesman. "We look forward to demonstrating at the district court level that Microsoft did not infringe the '131 patent and that the patent is invalid."

The software giant noted it expects to be only a minor player in that dispute.

The appeals court decision has no bearing on Alcatel-Lucent's appeal in another Microsoft lawsuit, in which a a lower court nixed a $1.5 billion jury award to the telecommunications giant in an MP3 case.

Alcatel-Lucent is still awaiting for its appeal to be scheduled with the court.