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New York Business correspondent, Patrick O'Connell
"If nothing else, the saga proves the software industry has come of age"
 real 28k

Monday, 22 November, 1999, 22:20 GMT
Microsoft faces civil suits
Damages claims are filed over Windows marketing

A civil lawsuit has been filed in California which threatens to cost the US software giant, Microsoft, billions of dollars.

The action follows the anti-trust ruling two weeks ago that Microsoft has abused its dominant position in the market.

Microsoft boss Bill Gates: Might settle out of court
Lawyers in San Francisco have filed a suit alleging that Microsoft used its monopoly power to overcharge buyers of its Windows 95 and 98 PC operating systems.

The case, which does not specify how much Microsoft should be fined, asks that the court triple any punitive damages awarded in the case, according to one lawyer involved.

Another has estimated that the suit could represent more than 10 million computer users in California.

Legal experts say they believe the preliminary ruling by District Judge Thomas Penfield Jackson in the anti-trust case has made the climate ideal for a series of civil suits against Microsoft.

"This could be a race to get to the courthouse," lawyer Stephen Axinn told the New York Times.


Last week, a lawyer in New Orleans filed a suit seeking to represent millions of Windows 98 users across the US.

It alleges that Microsoft used intimidation to reduce consumer choice and inflate the prices of its products.

Drawing on Judge Jackson's ruling, it cites a Microsoft study that found the company could make a profit by charging customers $49 for a Windows 98 upgrade - but nevertheless set the market price at $89.

Another suit has been filed by a New York advertising firm on behalf of thousands of consumers in the area.

Microsoft has argued that, because its operating systems were usually sold pre-installed on PCs, any alleged abuse of power could not have affected consumers directly.

Finding the facts

Judge Jackson took the unusual step of separating his findings of fact from the findings of law in the case - giving the opportunity for civil suits to be filed now on the basis of his findings of fact.

Given that they so strongly supported the government's position, most legal experts believe his final verdict - the findings of law - will rule that Microsoft was indeed in violation of the law.

This could then open the way for the civil suits to proceed - costing Microsoft billions of dollars in damages.

This threat is expected to make Microsoft keen to reach an out-of-court settlement in the anti-trust case.

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See also:
19 Nov 99 |  Business
Microsoft trial mediator welcomed
15 Nov 99 |  The Company File
Gates rebounds from court blow
06 Nov 99 |  The Company File
Analysis: Ruling brings settlement closer
10 Nov 99 |  The Economy
Gates offers compromise
26 Oct 99 |  The Company File
Microsoft joins Dow Jones
23 Nov 99 |  Microsoft
Microsoft vs US Justice Dept

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