Rejecting Microsoft's appeal, the US supreme court upheld the 2009 lower court order against Microsoft to pay $290 million in damages to the Toronto firm for infringing its patent.
The Canadian company had taken the software giant to court in the US in 2007 over violations of its patent in Word applications and won the case and got $290 million in damages in December 2009.
In its lawsuit, i4i had claimed that the world's biggest software company infringed on a patent granted to it in 1998.
The patent pertained to i4i's technology that can open documents using the XML computer programming language and manipulate complex data in electronic documents.
The technology allows users to sort out and manage tons of information by turning complex documents into more accessible databases.
The Toronto company claimed that Microsoft violated its patent when it created Word 2003 and Word 2007 software.
Later in 2009, the US court of appeals upheld the lower court order banning Microsoft from selling its patent-infringing Word processing software from January 2010.
Though Microsoft complied with the court order by stopping selling versions of Word with the disputed technology from that date, it challenged the verdict in the US supreme court in August last year, arguing that the current system is disproportionately loaded in favor of patent holders.
i4i chairman Loudon Owen called Thursday's court decision "extremely gratifying'' for his small firm.
"It has also become one of the most important business-law cases decided by the Supreme Court in decades,'' he told the local media.
