The patent filed in June 2011 was issued on Dec 13th, 2012 (pretty fast, eh?) I think Google's Ingress game has more to worry about, but there could be some overlap with Geocaching. However... I'm pretty sure GC.com can easily find prior work to negate the patent. We've been motivated to capture coordinates and pictures for years. It will be interesting to see how and if Microsoft tries to enforce it.
GEOGRAPHIC DATA ACQUISITION BY USER MOTIVATIONAbstract
Architecture that motivates and utilizes users as the means for capturing geographical data of a desired location. The architecture incentivizes users (e.g., large numbers of mobile-phone and mobile-computer users) to provide the data in the form of geolocation information trails and images captured by user devices. Thus, users take multiple pictures, for example, and can validate existing coverage of specific points of interest based on variable needs of the requestor. One motivational technique is by using augmented reality (AR) games, which include shooting targets associated with the point of interest (e.g., a street). Thus, the game can be designed for the data accumulation, which includes visual data. Additionally, the architecture can determine the areas or points of interest for validation and/or additional coverage by comparing live video data to an image database to decide of the need for update.