This article (Bruce Perens, Datamation) gives a good analysis over the closing of a 5-year old court case involving open source software and patent infringements.
The good news is that the party accusing the open source developer of patent infringements has lost both patents in question and has paid the developer $100000, among other things.
Basically, a physicist named Bob Jacobsen who also develops software controlling model trains as a hobby (and released them under open licenses) was accused by Matthew Katzer, a seller of software for model trains, of patent infringement. The problem is that Jacobsen's license was meant to ensure that all software covered in the license would be released under a similar license, with which Katzer did not comply (the non-compliance came in the form of a patent application). Worse, Katzer extended his original 1998 patent to cover this open source code while keeping it under the 1998 date to make it look like Jacobsen was guilty of patent infringement. That shows the worst side of today's patent system and how it really doesn't promote innovation.
Despite numerous pressures (financial and otherwise) on Jacobsen, he persevered. The worst part was when Katzer essentially dismissed the open license (requiring use of the license for derivative works) as essentially public domain and thus patentable in a specific application. This basically threatened the basis of all works published under open licenses like the GPL. When it became clear that Jacobsen's Artistic 1.0 license was legally inadequate, ironically (though I don't approve of this part) the law that came to Jacobsen's rescue was...a law I have railed against multiple times...the DMCA.
What? The DMCA came to the rescue of an open developer?
Funny how the world works, huh?
Basically, the DMCA provided the requirement of retaining attribution and the original license on the work (Katzer was removing Jacobsen's name and license from the code).
Things went downhill for Katzer from there.
Ironically, despite the provisions of Jacobsen's license, as punishment, Katzer can no longer copy, modify, or distribute the model train code (though everyone else can). He can no longer take trademarks of Jacobsen's project. He must pay Jacobsen $100000 over 18 months or pressure people close to Jacobsen about this during this same time period. Both sides have agreed to not sue each other within these same 18 months.
Most importantly, however, unlike most court cases, this one is not sealed, meaning that all details of the case are open to public scrutiny. This is extraordinarily important, as people can now make sure that a similar drawn-out case does not happen again.
Congrats, Bob Jacobsen, and hooray to the open source community!