Microsoft has won its lawsuit defending their stance against the company Alcatel-Lucent over the licensing of MP3 technology. Microsoft were in line to pay a fine to Alcatel-Lucent in the region of $1.53 million, which would have stretched even the bank balance of Bill Gates.

The win came in the U.S. Court of Appeals for the Federal Circuit. The claim was surrounding the MP3 software that Microsoft used in their Windows Media Player. They used an MP3 compression codec that was developed by Fraunhofer Labs, and Microsoft uphold that the German firm rightfully held the patent.

In 2003 Microsoft paid Fraunhofer Labs $16 to licence their MP3 player codec, which the German company had developed along with Bell Labs and Thomson. Alcatel-Lucent own Bell Labs as of a merger in 2006, but they claim the patents held were on board before Fraunhofer got hold of them.

In an attempt to gain the remuneration they believed they deserved, Alcatel went after the hardware manufactures such as Dell, and then Microsoft.

Microsoft were fined $1.53 billion on 2007, a fine which has now been overturned.