The Microsoft patent suit against TomTom has attracted some attention in the linux development community because the last three of the 8 patents being used by Microsoft involve features implemented in Linux. Two of those patents are the infamous FAT patents on long file names in a FAT file system. The third is a patent on a file system layer designed for use on flash memory.
The first thing to note is that Microsoft does not appear to have obtained patents for these features in Australia at all, so businesses operating only in Australia are unlikely to face problems with these patents
Even if the patents were present in Australia, as a practical matter the software industry is subject to so many patents that it is impossible for any moderately sized application to avoid infringing on patents. Microsoft alone has ofer 10,000 patents in the United States, over 1,200 patents in Australia, and over 2,800 applications on the Patent Cooperation Treaty register. Microsoft's products will also infringe on many patents owned by others. In that context the existence of a patent suit that seeks to attack Linux should not affect decisions to make use of Linux in a business. Software businesses should select the best tool for the job without paying too much attention to specific patent infringement actions involving third parties.
Leaving aside any issues with recent Supreme Court decisions limiting patentability on some types of patents, Microsoft's choice to use these 3 patents raises some other issues.
One of the requirements for patentability in the United States under 35 USC 101 is that the invention is useful. The claimed "invention" in the FAT long file names patents is not on long file names generally, but on a way of encoding long file names in a FAT file system without disturbing legacy applications that could not read them. This is something that was useful to Microsoft because it supported Microsoft's commercial advantage as the incumbent dominant operating system provider. If the legacy applications were to be broken then the market may have been more open alternatives to Microsoft's operating systems - if you lose compatibility anyway, there is no advantage to sticking to Microsoft. Arguably the requirement for usefulness in patents is that the invention be useful to society generally, not to the inventor. Even if usefulness to the inventor were sufficient, that usefulness no longer exists, so it could be argued that even if the invention qualified in 1995, it does not qualify now.
If any usefulness is to be found in FAT long file names now it is in the ability to share portable media with users of Microsoft operating systems. Microsoft is the only producer of modern desktop operating systems that does not include support in its operating system for any file systems used by other operating systems. Microsoft's failure to do so means that other operating systems may have no choice but to implement FAT (including its long file names) for compatibility with users of Microsoft operating systems. This kind of "usefulness" involves some bootstrapping - the usefulness arises from Microsoft's decision to make use of it, not from the inherent usefulness of the invention.
The flash file system layer patent seems to face major obstacles on the question of obviousness, even on the low standard of obviousness applying to patents in the United States. There does not seem to be anything in the claims of the patent that was not dictated by the problem at hand. A skilled person who has no knowledge of the Microsoft method, faced with solving the problem, would be very likely to have come up with a solution that is not relevantly different, and would have done so with very little effort.
Like the FAT patent, Microsoft's use of this "invention" forces others to use the same invention to allow for data transfers with users of Microsoft Windows.
The fact that others are forced to use the Microsoft formats to exchange data with Microsoft's customers raises some serious competition law issues for Microsoft if it attempts to enforce these patents against a competitor. Like most United States statutory provisions, the competition law provisions are few in number, but cover broad concepts, leaving the Courts to fill in the details. Relevantly there is a prohibition on attempting to monopolise trade (15 USC 2) which may be breached by Microsoft, as a dominant player, seeking to extract licence fees from others who use its "inventions" solely because Microsoft's position of dominance forces them to.
It is not clear from the Microsoft claims that the three patents asserted against Linux in the TomTom suit are valid. Even if they are, Microsoft may be prevented from enforcing them on competition law or other grounds. For Australian companies doing business overseas with Linux, the risk may not be sufficient to warrant significant changes to business plans, and where there is no need for file exchange with Windows users, and no need to use flash data exchange, it may be possible for the Australian business to avoid these specific patents.