Inventor and physiologist Mark Goldstein's September, 1997, meeting with Microsoft executives was a disappointment: After a two-hour tête-à-tête about licensing his labor of love -- an ergonomic computer mouse that he claims virtually eliminates wrist strain -- the Redmond (Wash.) tech giant rejected a deal.

More than a year later, the sting of that encounter has hardly abated. On Dec. 15, the 48-year-old Australian sued Microsoft for $1 billion, charging the company with stealing his design concepts during that meeting and launching a competing product, the Intellimouse Pro.

Goldstein's quixotic suit is one of several by entrepreneurs who, emboldened by the Justice Dept.'s epic antitrust battle against Microsoft, have decided to challenge one of the world's richest companies in court. And Goldstein's company, Goldtouch Technologies Inc., is minuscule, even in the mouse niche. According to market researcher PC Data, Microsoft's share of the mouse market is 18.7% in unit terms and 34.8% in dollars. PC Data tracks the top 20 mouse manufacturers, the smallest of which has 0.1% of the market. Goldtouch isn't among them.

Microsoft has yet to file a response in the case, but company spokesperson Tom Pilla says the company "is not infringing on any valid patent claim."

	The Goldtouch Mouse

ERGO INVENTOR. Goldstein founded Goldtouch in 1997 to make and distribute his Goldtouch Mouse, whose sculpted curves are claimed to alleviate the chronic pain that afflicts many who work long hours on computers.

Using a process called electromygraphy to measure muscle movement in the hand and wrist, Goldstein found parts of his design reduced muscle strain in certain parts of the hand by as much as 99%. He and his wife, Liz, spent months shaping clay models in their Sydney Australia home to create the right silhouette. "We have the best mouse on the market," Goldstein boasts.

The inventor knew the ropes in the computer industry. He had already invented an adjustable, two-piece keyboard and licensed it to IBM and its spin-off, Lexmark. So Goldstein set out to make the rounds of big computer companies with his new creation. This time, he got no takers. Microsoft was one of several who turned down a deal.

Frustrated, Goldstein decided to manufacturer the mouse by himself. With licensing, "you're at the whim of every guy who wants to take advantage of you," he says. "We decided to take control." Goldstein won't say how many he sold, but he claims that before Microsoft's mouse hit the market, it was "pretty successful."

Goldstein's complaint, filed in Texas Federal Court, alleges that Microsoft's designers weren't impervious to the potential of Goldstein's preproduction samples. By late 1998, Microsoft had rolled out the Intellimouse Pro. "Microsoft has sought to add Goldtouch's purloined intellectual property to Microsoft's already impressive hoard of ill-gotten gains," the complaint argues. "[I]n so doing, Microsoft has dealt Goldtouch a grievous wound." The core of Goldtouch's claim is that Intellimouse Pro replicates the essential features of the Goldtouch Mouse -- its steeply curved palm rest, a form that's covered by the product's two patents.

Goldstein learned of the Microsoft mouse when a friend alerted him. "I really thought we could approach them with a legitimate business strategy to license or co-market," says Goldstein, who moved to the U.S. and tapped into his life savings to get Goldtouch off the ground. "We approached them on a good faith basis."

As a tiny company, however, he'll need plenty of patience during the lawsuit. "There is always the hazard that a [patent] case can drag on for months or years," says Timothy J. O'Hearn, an intellectual property lawyer at Jones, Day, Reavis & Pogue in Cleveland. "For a small, five-person shop, it could be a big distraction. It can wear on you."

What chance does Goldtouch have of winning? O'Hearn explains that lawsuits based on so-called "design patents" -- which cover how a product looks -- are much harder to defend than "utility patents," which cover how a product is used. Goldtouch has both patents. Still, O'Hearn observes, "Mouses have been around for a while." That makes it hard to prove that a design is completely unique, especially against a company such as Microsoft, which presumably could have a number of mouse-development projects in its research pipeline.

For now, Goldstein says he'll continue manufacturing his mouse. With a legal fight consuming his time and resources, making headway in the court of consumer opinion will be no easy task. Can he prevail? That will be the true test of Goldstein's creation.

By Dennis Berman in New York
dennis_berman@businessweek.com

To: LAW