Press Release

InterTrust Patent Suit Expanded to Include Microsoft eBook Technology

InterTrust patented DRM components in Microsoft's Reader, Digital Asset Server, and e-Book initiative products

July 19, 2001 -- InterTrust Technologies Corporation, the leading inventor of Digital Rights Management (DRM) technology, announced today that it will amend its patent lawsuit against Microsoft Corporation to include key inventions by InterTrust that underlie Microsoft eBook rights management technologies and other products offering DRM capabilities.

This second amended complaint alleges that Microsoft willfully infringes InterTrust's US Patent No. 5,920,861 (`861 patent). It seeks unspecified damages and an injunction prohibiting further infringement by Microsoft products, including Microsoft's Reader and Digital Asset Server.

"InterTrust is taking a careful and deliberate approach in analyzing Microsoft products for infringement of InterTrust's many patented inventions," said Ed Fish, President of InterTrust's MetaTrust Utility division. "We have found that rather than innovate, Microsoft has ignored our rights and has copied pioneering InterTrust inventions. Whether in Windows Media Player, Microsoft e-Book products, or current and future versions of the operating system, these DRM components were invented by InterTrust long before DRM was a generally recognized concept. Microsoft's actions in appropriating our inventions and weaving them into their products have caused us to expend increased time and energy in protecting our valuable assets. We will protect these assets just like Microsoft does when its own intellectual property is pirated."

"DRM technology must be a neutral foundation upon which digital trust can be established and maintained, said Victor Shear, Chairman & CEO of InterTrust. Without that foundation, providers and users of digital information are at the mercy of the operating system, and will ultimately lose options, anonymity and autonomy that they have come to expect. We are committed to using our resources, including our patents, to ensure that this neutral environment is protected."

The lawsuit, originally filed on April 26, 2001 in the United States District Court for the Northern District of California, now contains three (3) InterTrust patents covering a wide variety of DRM technologies. The suit specifically addresses Microsoft's infringement of InterTrust property rights through sale and distribution of Microsoft application, server, and operating system products.

This includes components of Microsoft's Windows Media, Microsoft Reader and Digital Asset Server, as well as its WindowsME and Windows XP operating systems.

Recently, a number of reports have provided new insight into the rapidly emerging DRM marketplace. According to International Data Corporation's (IDC's) June report, the DRM market will have annual revenues of $3.6 billion in 2005. MetaGroup estimates that digital content sales will reach $300 billion in 2004, of which $100,000 billion will be digitally downloadable.

About InterTrust Technologies Corporation

Over the past eleven years InterTrust has been the leading developer of basic DRM technology, and it continues to pioneer the DRM landscape today. As the first company to devise a digital commerce network, branded the MetaTrust Utility, to help other businesses manage and protect their proprietary data, and as the first provider and principal inventor of peer-to-peer and rules-based rights management, InterTrust acts as a neutral third party to ensure e-commerce and enterprise security and rights management.

This ensures a secure, interoperable trust foundation for the Internet and among all forms of computing devices. InterTrust's more than 40 licensees and partners include Adobe, AOL/TimeWarner, BlockBuster, BMG Entertainment, Cirrus, Compaq, Digital World Services, Enron, Magex, Mercurix, Mitsubishi, Nokia, Philips, Samsung, Texas Instruments, Universal Music Group, and Wave Systems. InterTrust's continuing inventive work has resulted to date in 21 issued US patents and more than 80 patents pending.

InterTrust is dedicated to the development of DRM technology and the availability of an effective DRM environment. DRM is InterTrust's sole business focus.

About InterTrust's `861 patent

InterTrust's '861 patent issued on July 6,1999. Based on an application filed in February of 1997, it covers fundamental techniques for managing digital information, such as the use of data structures, rules and metadata to organize, package, and manage digital content. This includes, for example, specific techniques and technologies supporting use of data structure templates and the expression of associated rules in the process of packaging protected content.

The statements contained in this release that are not purely historical are forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, including statements regarding InterTrust's expectations, beliefs, hopes, intentions or strategies regarding the future. All forward-looking statements included in this document are based upon information available to InterTrust as of the date hereof, and InterTrust assumes no obligation to update any such forward-looking statement.

Actual results could differ materially from current expectations. Factors that could cause or contribute to such differences include, but are not limited to, the factors and risks discussed in InterTrust's reports filed from time to time with the Securities and Exchange Commission.

The statements in this release regarding InterTrust's patents are intended for purposes of illustration only, and are not meant to cover or describe all possible applications, variations, or interpretations of the patented inventions. Nothing contained in this release is intended for use in construing the scope, content, or meaning of the patent's claims, specification, or prosecution history, or of any other patent-related materials.

(c) 2001 InterTrust. DigiBox, the InterTrust logo, MetaTrust, and The MetaTrust Utility are registered trademarks of InterTrust Technologies Corporation, and TrustChip, RightsChip, InterRights Point, MetaTrust-Certified, Rights/PD and Rights/System are trademarks of InterTrust Technologies Corporation, all of which may or may not be used in certain jurisdictions. All other brand or product names are trademarks or registered trademarks of their respective companies or organizations.

Todd Slosek, 415/350-8943
tslosek@intertrust.com

or

Ketchum
Julius Turman, 415/984-6186
julius.turman@ketchum.com