The US Court of Appeals for the Federal Circuit on Thursday affirmed a district court's grant of judgment as a matter of law to Microsoft Corp. in a suit involving alleged infringement of digital music patents held by Alcatel-Lucent. The court ruled that of the two patents, Microsoft had not infringed one and had a license for the other. The court reasoned:

A grant of JMOL is appropriate when 'the evidence, construed in the light most favorable to the non-moving party, permits ony one reasonable conclusion and that conclusion is contrary to the jury's...A patentee may rely on either direct or circumstantial evidence to prove infringement. In order to prove direct infringement, a patentee must either point to specific instances of direct infringement or show that the accused device necessarily infringes the patent in suit. Lucent did not show specific instances of direct infringement. Instead, Lucent relied on circumstantial evidence to attempt to show that Microsoft's Windows Media Player necessary infringes its patent.

  The district court found, however, that the circumstantial evidence presented by Lucent established only uncertainty and speculation as to whether [its technology] had run even once [in Windows Media Player]...Lucent has failed to provide sufficient evidence to establish that [its technology] actually runs on Windows Media Player and thus it would be too speculative to conclude that Windows Media Pladecisionyer necessarily infringes [Lucent's] patent.

Disappointed with the decision, an Alcatel-Lucent spokesperson told reporters, "It is too early to speculate on what our next steps might be."

The patents govern technology that converts audio input into MPEG-1 Audio Layer 3, more commonly known as MP3, which Microsoft has incorporated into several variants of its Windows Media Player. Last August, a San Diego district court granted Microsoft JMOL or, in the alternative, a new trial following the $1.52 billion jury award originally granted after Microsoft lost at trial.