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Utah company wraps up $1B case against Microsoft

Utah company wraps up $1B case against Microsoft

By Associated Press | Updated: 6 June 2012 13:32 IST

Highlights

Microsoft purposefully duped a Utah company into believing its writing application would be included in the Windows 95 rollout, then pulled the plug so Microsoft could gain market share with its own product

Microsoft Corp. purposefully duped a Utah company into believing its writing application would be included in the Windows 95 rollout, then pulled the plug so Microsoft could gain market share with its own product, an attorney said on Tuesday in closing arguments for a $1 billion antitrust lawsuit against the software giant.

"It was purely a predatory action," Novell Inc. attorney Jeff Johnson told jurors.

Utah-based Novell sued Microsoft in 2004, claiming the Redmond, Wash., company violated U.S. antitrust laws through its arrangements with other software makers when it launched Windows 95. Novell said it was later forced to sell WordPerfect for a $1.2 billion loss.

Novell is now a wholly owned subsidiary of The Attachmate Group, the result of a merger that was completed earlier this year.

Microsoft lawyers have argued that Novell's loss of market share was its own doing because the company didn't develop a compatible WordPerfect program until long after the rollout of Windows 95.

"Novell was late. It was always behind. It was playing catch-up," Microsoft attorney David Tulchin said during closing arguments.

The jury was expected to begin deliberations on Wednesday.

Tulchin recapped testimony by a series of former WordPerfect and Novell executives who recalled that WordPerfect was hitting its zenith by the time Novell bought it in 1994. Novell neglected the product and was slow to develop new versions for the Windows operating system or recognize the power of Microsoft's graphical operating system, he said.

"In the high-tech world where things can move quickly ... the market can kill you," he said.
Novell's lawsuit is the last major private antitrust case to follow the settlement of a federal antitrust enforcement action against Microsoft more than eight years ago. Novell's trial began in October in federal court in Salt Lake City.

Johnson has conceded that Microsoft was under no legal obligation to provide advance access to Windows 95 so Novell could prepare a compatible version. Microsoft, however, enticed Novell to work on a version, only to withdraw support months before Windows 95 hit the market, he said.

Microsoft co-founder Bill Gates testified last month that he had no idea his decision to drop a tool for outside developers would sidetrack Novell. Gates said he was acting to protect Windows 95 and future versions from crashing.

Novell could have worked around the problem but failed to react quickly, he said.

Gates also said Novell couldn't deliver a compatible WordPerfect program in time for the rollout, and that Microsoft's own Word program was actually better. He said that by 1994, the Word writing program was ranked No. 1 in the market, above WordPerfect.

WordPerfect once had nearly 50 percent of the market for word processing, but its share quickly plummeted to less than 10 percent as Microsoft's own Office programs took hold.

Novell has argued that Gates ordered Microsoft engineers to reject WordPerfect as a Windows 95 word processing application because he feared it was too good.

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