The US Court of Appeals has upheld a ruling from May 2009 that Microsoft is infringing the patents of a database design company called i4i. Microsoft has been ordered to stop selling Microsoft Word and Office by January 11.

The suit revolves around Word's use of .xml, .docx and .docm files, which have been ruled to infringe on XML-handling algorithms patented by i4i. An injunction on sales of the software has been issued, but it's possible that Microsoft could appeal again - this time to the Supreme Court.

Microsoft has issued a statement saying "We are moving quickly to comply with the injunction, which takes effect on January 11, 2010", and adding: "we expect to have copies of Microsoft Word 2007 and Office 2007, with this feature removed, available for U.S. sale and distribution by the injunction date".

The ruling doesn't affect sales of the product outside of the USA, though it's possible that Microsoft may patch it out worldwide anyway. Nor does it affect existing copies of Office - the injunction only applies to new sales. Beta versions of Office 2010 don't contain the patented XML technology.

Microsoft says: "While we are moving quickly to address the injunction issue, we are also considering our legal options, which could include a request for a rehearing by the Federal Circuit Court of Appeals en banc or a request for a writ of certiorari from the U.S. Supreme Court" - so perhaps this still isn't over yet?

We'll keep you posted.

Update: Microsoft already has a patch available for the software, which is "required" for the United States. If you want to remove the XML read functionality from your software, then hit up Microsoft's website.