Novell to appeal dismissal of $1.3 billion antitrust claim against Microsoft

Utah company Novell, which filed the suit in 2004, has confirmed it plans to appeal the decision concerning its WordPerfect writing application.

The dispute stems back to the mid-1990s, when Microsoft made last-minute changes to Windows 95 before launching the operating system. Novell claimed Microsoft intentionally withheld information about the changes, preventing Novell from making its office suite compatible in time for the release. Novell argued that as a result, WordPerfect was unable to compete with Microsoft Word, and it was eventually forced to sell the program at a $1.2 billion loss.

During an eight- week trial which began in October 2011, former Microsoft CEO Bill Gates testified that Novell simply failed to deliver a compatible version of its software in time. When the trial ended with a hung jury in December last year, the judge declared a mistrial.

Microsoft subsequently applied for a motion to dismiss the case under Rule 50, which states that if the jury returns a verdict, the court can allow judgment, order a new trial, or direct the entry of judgment as a matter of law.

US district judge Frederick Motz granted the motion to dismiss. He said that internal issues at Novell, including a “mass exodus” of programmers from its Scotts Valley, California facility, had contributed to the delay in reworking the company’s software. He also noted he had seen no evidence that Novell had ever complained to Microsoft about the problem.

He concluded that while “a jury could have found that Microsoft engaged in aggressive conduct, perhaps to monopolize or attempt to monopolize the applications market”, Novell did not present sufficient evidence for a jury to find that Microsoft violated Section 2 antitrust laws.

David Howard, Microsoft’s deputy general counsel, said in a statement: “We’ve maintained throughout this case that Novell’s arguments lack merit, and we’re gratified with today’s ruling dismissing the last of Novell’s claims and putting this matter to rest.”

Jim Lundberg, vice president of Novell’s legal team, said that although the company is disappointed by the ruling: “Novell still believes in the strength of its claim and we do intend to pursue an appeal."

Microsoft is no stranger to claims that it employs anticompetitive tactics. Its business practices have raised objections from companies including Google, Motorola, and Sun Microsystems, and it has received several multimillion-euro fines from European antitrust officials.

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