Microsoft litigation
Encyclopedia
Microsoft
has been involved in numerous high-profile litigations over the history of the company, including cases against the United States, the European Union, and competitors.
, Microsoft stated:
filed on July 15, 1994, Microsoft agreed to a deal under which, among other things, the company would not make the sale of its operating systems conditional on the purchase of any other Microsoft product. On February 14, 1995 Judge Stanley Sporkin
issued a 45-page opinion that the consent decree was not in the public interest. Later that spring, a three-judge federal appeals panel removed Sporkin and reassigned the consent decree. Judge Thomas Penfield Jackson
entered the decree on August 21, 1995, three days before the launch of Windows 95
.
A Microsoft purchase of Intuit was scuttled in 1994 due to antitrust concerns that Microsoft would be purchasing a major competitor.
After bundling the Internet Explorer
web browser
into its Windows operating system in the late 1990s (without requiring a separate purchase) and acquiring a dominant share in the web browser market, the antitrust
case United States v. Microsoft
was brought against the company. In a series of rulings by judge Thomas Penfield Jackson, the company was found to have violated its earlier consent decree and abused its monopoly in the desktop operating systems market. The "findings of fact" during the antitrust case established that Microsoft has a monopoly
in the PC desktop operating systems market:
The findings of fact go on to explain the nature of the "barrier to entry":
The proposed remedy (dividing Microsoft into two companies) was overturned on appeal. While new penalties were under consideration, the Clinton administration ended and the Bush administration took office. The new administration announced that in the interest of ending the case as quickly as possible, it would no longer seek to break the company up, and that it would stop investigating claims of illegal tying of products. Eighteen days later, Judge Kollar-Kotelly ordered the justice department and Microsoft to "engage in discussions seven days a week, 24 hours a day." The judge cited the events of September 11, 2001 in her direction to begin settlement talks but did not explain the linkage between the two. Attorney General Ashcroft, however, denied that the events of September 11 had any effect on the outcome. Microsoft subsequently reached a settlement with the Department of Justice
and some of the states which brought suit against it. Several class-action lawsuits filed after the conviction are still pending.
In early 2002, Microsoft proposed to settle the private lawsuits by donating $1 billion USD in money, software, services, and training, including Windows licenses and refurbished PCs, to about 12,500 underprivileged public schools. This was seen by some as a potential windfall for Microsoft, not only in educating schoolchildren on Microsoft solutions but also in collecting additional license fees if the schools ever wanted to upgrade. After protests from Apple Inc. which feared further loss of its educational market share, a federal judge rejected the proposed settlement.
In 2003–2004, the European Commission
investigated the bundling of Windows Media Player
into Windows, a practice which rivals complained was destroying the market for their own products. Negotiations between Microsoft and the Commission broke down in March 2004, and the company was subsequently handed down a record fine of €497 million ($666 million) for its breaches of EU competition law. Separate investigations into alleged abuses of the server market were also ongoing at the same time. On December 22, 2004, the European Court decided that the measures imposed on Microsoft by the European Commission would not be delayed, as was requested by Microsoft while waiting for the appeal. Microsoft has since paid a €497 million fine, shipped versions of Windows without Windows Media Player
, and licensed many of the protocols used in its products to developers in countries within the European Economic Area. However, the European Commission has charactized the much delayed protocol licensing as unreasonable, called Microsoft "non-compliant" and still violating antitrust law in 2007, and said that its RAND
terms were above market prices; in addition, they said software patent
s covering the code "lack significant innovation", which Microsoft and the EC had agreed would determine licensing fees. Microsoft responded by saying, that other government agencies had found "considerable innovation". Microsoft appealed the facts and ruling to the European Court of First Instance with hearings in September 2006.
On September 17, 2007, the EU Court of First Instance rejected Microsoft's appeal.
The court affirmed the original contested finding:
All elements of Microsoft's appeal were dismissed.
Microsoft accepted the judgment of the Court of First Instance and proceeded to make available interoperability information as originally required by the European Commission.
Microsoft also faced competition law in South Korea and was fined $32 million in December 2005 and ordered to unbundle instant messaging, Windows Media Player and Windows Media Service, or let competitors' products take their place. Microsoft noted in their October 2005 SEC filing that they may have to pull out of South Korea, although they later denied fulfilling such a plan. Microsoft's 2006 appeal was struck down; they have another appeal pending.
European antitrust regulators on February 27, 2008 fined Microsoft $1.3 billion for failing to comply with a 2004 judgment, that the company had abused its market dominance. The new fine by the European Commission was the largest it has ever imposed on an individual company, and brings the total in fines imposed on Microsoft to about $US 2.5 billion, at current exchange rates.
Microsoft had previously been fined after the commission determined in 2004 that the company had abused the dominance of its Windows operating system to gain unfair market advantage. The commission imposing the new fine said, that it was because the company had not met the prescribed remedies after the earlier judgment.
of the European Union
(EU) against Microsoft
for abuse of its dominant position in the market (according to competition law
). It started as a complaint from Novell
over Microsoft's licensing practices in 1993, and eventually resulted in the EU ordering Microsoft to divulge certain information about its server products and release a version of Microsoft Windows
without Windows Media Player
.
On February 27, 2008 the European Union (EU) competitions commission announced its decision to fine the Microsoft Corporation €
899 million (US$
1.35 billion), approximately 1/10 of the company's net yearly earnings, for failing to comply with the 2004 antitrust order .
The first decision in this antitrust case was given in 2004 citing that Microsoft withheld needed interoperability
information from rival software companies which prevented them from making software compatible with Windows
. The commission ordered Microsoft to provide this information. Microsoft agreed to this, providing the information for royalty fees of 6.85% of the licensee's revenues for the product on grounds of innovation (specifically, 3.87% for the patent license and of 2.98% for the information license). The EU found these royalty fees unreasonable and Microsoft was ordered to lower them. Microsoft complied with this, adjusting the royalty rates to 1.2% (changing the rates for the licenses to 0.7% and 0.5%, respectively) in the European Union, while keeping the rate the same for the rest of the world. The EU still saw this as an unreasonable rate, and Microsoft, two month after lowering the rates, reduced the rates yet again to a flat rate of €10000 or a royalty of 0.4% applicable worldwide. Microsoft's royalty rates, which were deemed unreasonable for the period of 15 months between June 21, 2006 and October 21, 2007 are the cause for the fine. So far, the EU has fined Microsoft €1.68 billion in 3 separate fines in this case. This fine will go towards the European Union annual budget.
The European Anti-trust commissioner Neelie Kroes stated that the fine was "reasonable and proportionate," as the figure could have gone up as high as €1.5 billion, the maximum that the EU commission can impose. She also said that it should act as "a signal to the outside world, and especially Microsoft, that they should stick to the rules" and that "Talk is cheap. Flouting the rules is expensive." Although she also expressed hope that "today's decision closes a dark chapter in Microsoft's record of non-compliance with the Commission."
It is not certain whether Microsoft will appeal this decision. A Microsoft spokesperson has stated that Microsoft will review this latest fine, citing that "The commission announced in October 2007 that Microsoft was in full compliance with the 2004 decision, so these fines are about the past issues that have been resolved." Microsoft's General Counsel Brad Smith commented "It's clearly very important to us as a company that we comply with our obligations under European law. We will study this decision carefully, and if there are additional steps that we need to take in order to comply with it, we will take them." Microsoft had appealed against fines by the EU before, but all the charges were defeated. If Microsoft does not appeal the decision, the company will have 3 months (starting February 27) to pay the fine in full.
The decisions came after Microsoft announced they were disclosing 30,000 pages of previously secret software code last Thursday (February 21). The EU competition commissioner commented that this move "does not necessarily equal a change in business practice."
In September 2011, the competition commission in Spain
began an investigation into Microsoft's licence agreements, which prevent the transfer of Microsoft software to third parties.
(D.D.C. 2000) was a set of consolidated civil actions filed against Microsoft Corporation on May 18, 1998 by the United States Department of Justice
(DOJ) and twenty U.S. states. Joel I. Klein
was the lead prosecutor. The plaintiffs alleged that Microsoft abused monopoly
power in its handling of operating system
sales and web browser
sales. The issue central to the case was whether Microsoft was allowed to bundle its flagship Internet Explorer
(IE) web browser software with its Microsoft Windows
operating system. Bundling them together is alleged to have been responsible for Microsoft's victory in the browser wars
as every Windows user had a copy of Internet Explorer. It was further alleged that this unfairly restricted the market for competing web browsers (such as Netscape Navigator
or Opera
) that were slow to download over a modem or had to be purchased at a store. Underlying these disputes were questions over whether Microsoft altered or manipulated its application programming interface
s (APIs) to favor Internet Explorer over third party web browsers, Microsoft's conduct in forming restrictive licensing agreements with OEM
computer manufacturers, and Microsoft's intent in its course of conduct.
Microsoft stated that the merging of Microsoft Windows and Internet Explorer was the result of innovation
and competition
, that the two were now the same product and were inextricably linked together and that consumers were now getting all the benefits of IE for free. Those who opposed Microsoft's position countered that the browser was still a distinct and separate product which did not need to be tied to the operating system, since a separate version of Internet Explorer was available for Mac OS
. They also asserted that IE was not really free because its development and marketing costs may have kept the price of Windows higher than it might otherwise have been. The case was tried before U.S. District Court Judge Thomas Penfield Jackson
. The DOJ was initially represented by David Boies
.
and Go's tablet-based computing efforts were shelved, PenWindows development was dropped.
In May 2004, a class-action lawsuit accused Microsoft of overcharging customers in the state of California. The company settled the case for $1.1 billion, and a California court ordered Microsoft to pay an additional $258 million in legal fees (including over $3,000 per hour for the lead attorney in the case, more than $2,000 per hour for colleagues, and in excess of $1,000 per hour for administrative work). A Microsoft attorney responded, "Somebody ends up paying for this. These large fee awards get passed on to consumers." The total bill for legal fees was later reduced to just over $112 million. Because of the structure of the settlement, the law firm which sued Microsoft could end up getting more money from the company than California consumers and schools, the beneficiaries of the settlement.
In 2006 Microsoft initiated an investigation of Lithuania
n government institutions for determining whether they choose long-term strategies of the software they use correctly. The investigation, funded by Microsoft itself, will be performed by the Vilnius University
together with the Lithuanian Institution of the Free Market, a think tank
organization. The investigation was initialised after the government started to prepare 860 thousand litas project to encourage the use of open-source software. The vice-president of Microsoft, Vahe Torossian, stated that "the government should not be technologically subjectivist"
Microsoft was sued for the "Windows Vista Capable" logo
and in Iowa
. Microsoft Word
was also a subject of court case.
(acquired by Alcatel
in 2006) filed suit against Gateway
in the U.S. District Court for the Southern District of California
in San Diego. Lucent also sued Dell
in the U.S. District Court for the Eastern District of Virginia
; soon thereafter, that court transferred the Dell case to San Diego, where it was consolidated with the case against Gateway. Lucent claimed in this first San Diego case that Dell and Gateway had violated patents on MP3-related technologies developed by Bell Labs
, a division of predecessor company American Telephone & Telegraph
. Other patents said to be infringed relate to MPEG video technology, speech technology, internet technology, and other technologies. Microsoft intervened in the lawsuit in April 2003 and Alcatel was added after it acquired Lucent.
After the first San Diego lawsuit was filed, Microsoft and Lucent have filed additional patent lawsuits against each other. In February 2007, Microsoft filed a lawsuit at the International Trade Commission claiming that Alcatel-Lucent infringed its patents. There is a second case in San Diego where Microsoft is asserting that Alcatel-Lucent infringes 10 of its patents, and yet another case in Texas where each alleges that the other is infringing its patents.
(9th Cir. 1994) was a copyright infringement
lawsuit in which Apple Computer, Inc. (now Apple Inc.) sought to prevent Microsoft Corporation and Hewlett-Packard
from using visual graphical user interface
(GUI) elements that were similar to those in Apple's Lisa
and Macintosh operating system
s. Some critics claimed that Apple was really attempting to gain all intellectual property
rights over the desktop metaphor
for computer interfaces, and perhaps all GUIs, on personal computer
s. Apple lost all claims in the lawsuit, except that the court ruled that the "trash can" icon and file folder icons from Hewlett-Packard's now-forgotten NewWave
windows application were infringing. The lawsuit was filed in 1988 and lasted four years; the decision was affirmed on appeal in 1994, and Apple's appeal to the U.S. Supreme Court was denied.
brought by Microsoft
against Lindows, Inc
, claiming that the name "Lindows" was a violation of its trademark
"Windows." In addition to the United States
, Microsoft has also sued Lindows in Sweden
, France
, Belgium
, Luxembourg
, The Netherlands
and Canada
. Michael Robertson has called this situation "Sextuple Jeopardy", an extension of the term double jeopardy
.
In response to these lawsuits, Lindows had launched ChoicePC.com, which allows people to purchase lifetime Lindows memberships that includes a free copy of LindowsOS, free LindowsOS upgrades for life, and a ChoicePC.com t-shirt, for $100 USD
. All money from the memberships goes towards helping Lindows in its legal battle against Microsoft.
high school student named Mike Rowe over the domain name
MikeRoweSoft.com. The case received international press attention following Microsoft's perceived heavy handed approach to a 12th grade student's part time web design
business and the subsequent support that Rowe received from the online community. A settlement was eventually agreed, with Rowe granting ownership of the domain to Microsoft in return for training and gifts.
was called Windows Commander; the name was changed in 2002 out of fear of a lawsuit after the developers received a letter from Microsoft pointing out that the word "windows" was trademarked by Microsoft.
in September 2003 out of fear of a lawsuit after the founder developer Julian Smart received a letter from Microsoft pointing out that the 'Windows
' is a UK trademark owned by Microsoft.
project was renamed to Nano-X Window System in January 2005, due to legal threats from Microsoft regarding the Windows
trademark.
game machine. A woman from California
sued Microsoft on October 2008 in Superior Court in Sacramento County, stating that the company violated multiple state consumer-protection and unfair-competition laws. The woman alleged that the company continued to sell the Xbox 360 even though it knew that the console's hardware was likely to fail.
operating system
pre-installed on it. The refund is issued by the hardware manufacturer, or occasionally the retailer, for the copy of Microsoft Windows, rather than the whole computer. Due to Microsoft's dominance in desktop computing and a lack of understanding on the manufacturer's or retailer's part, it is often difficult (but not impossible) for users to obtain a refund.
In 2006, a British man purchased a Dell Inspiron
640 m laptop
bundled with Microsoft Windows XP Home SP2 preinstalled, but he did not accept Microsoft's End User License Agreement (EULA)
. In one week after his response, the customer received a "goodwill" refund of GBP
£47 (£55.23 including tax) from Dell
for a no Windows option, as the copy of the system was an "unused product" according to the software license agreement. Dell had not asked for the installation medium to be returned and commented that although it does not have a Windows refund program, giving a refund in an individual case is not forbidden either.
In a civil suit, Italian court rejected HP's argument that the licensing conditions had been set unilaterally by Microsoft and ruled HP to reimburse customer the amount of 90 euro
for unused Windows XP bundled with Compaq
notebook. The court was of the opinion that HP had to know about the conditions, because they most likely constituted part of the agreement between them and Microsoft. It also found the fact that computers without an operating system are available on the market to be irrelevant. According Süddeutsche Zeitung
, a German Dell customer replaced the preinstalled Windows with Linux
and had been credited the amount of €78 for operating system and a further unspecified Microsoft program. A French court ruled Acer to refund the purchase price of preinstalled laptop software, of which was €135.20 for Windows XP Home. An Israeli Dell customer received $137 as refund for Windows Vista
.
Lenovo Czech Republic wanted its customer to sign a non-disclosure agreement
before Windows licence refund to prevent him from talking about the deal, but the customer refused and took the story to local Linux web portal AbcLinuxu.cz, which gave him an equivalent amount of money for telling his story to the world.
-native by the name of David Stebbins has recently filed a lawsuit against Microsoft, attempting to confirm an arbitration award
in the amount of $500 billion. He claims that his basis for the suit is that he is holding corporations to the same contract modification practices that they often use on customers. According to Stebbins, corporations can, and often do, unilaterally amend the terms of their contracts, often in subtle and inconspicuous ways.
Stebbins decided to "give them a taste of their own medicine" and sent notice to Microsoft stating the terms of his Xbox Live
gaming contract that he' d like to change, stating that Microsoft accepted the new terms upon not terminating Stebbins' account within ten days. These changes included an arbitration clause
requiring Microsoft to respond to an invitation of legal arbitration within 24 hours, and also what Stebbins refers to as a "forfeit victory clause," stating that, if Microsoft does not respond to the arbitration within the 24-hour time frame, Stebbins automatically wins. He initiated an arbitration against Microsoft, claiming $500 billion in damages, but Microsoft did not respond, and Stebbins is now attempting to confirm the arbitration award.
Microsoft has declined to comment.
Microsoft
Microsoft Corporation is an American public multinational corporation headquartered in Redmond, Washington, USA that develops, manufactures, licenses, and supports a wide range of products and services predominantly related to computing through its various product divisions...
has been involved in numerous high-profile litigations over the history of the company, including cases against the United States, the European Union, and competitors.
Governmental
In its 2008 annual reportAnnual report
An annual report is a comprehensive report on a company's activities throughout the preceding year. Annual reports are intended to give shareholders and other interested people information about the company's activities and financial performance...
, Microsoft stated:
Anti-trust
In the 1990s, Microsoft adopted exclusionary licensing under which PC manufacturers were required to pay for an MS-DOS license even when the system shipped with an alternative operating system. Critics attest that it also used predatory tactics to price its competitors out of the market and that Microsoft erected technical barriers to make it appear that competing products did not work on its operating system. In a consent decreeConsent decree
A consent decree is a final, binding judicial decree or judgment memorializing a voluntary agreement between parties to a suit in return for withdrawal of a criminal charge or an end to a civil litigation...
filed on July 15, 1994, Microsoft agreed to a deal under which, among other things, the company would not make the sale of its operating systems conditional on the purchase of any other Microsoft product. On February 14, 1995 Judge Stanley Sporkin
Stanley Sporkin
Stanley Sporkin is a former judge of the United States District Court for the District of Columbia. He was nominated to the seat vacated by Judge June Lazenby Green on April 5, 1985 by President Ronald Reagan, and was confirmed by the Senate on December 16; he received his commission the next day...
issued a 45-page opinion that the consent decree was not in the public interest. Later that spring, a three-judge federal appeals panel removed Sporkin and reassigned the consent decree. Judge Thomas Penfield Jackson
Thomas Penfield Jackson
Thomas Penfield Jackson is a former United States District Court Judge for the District of Columbia....
entered the decree on August 21, 1995, three days before the launch of Windows 95
Windows 95
Windows 95 is a consumer-oriented graphical user interface-based operating system. It was released on August 24, 1995 by Microsoft, and was a significant progression from the company's previous Windows products...
.
A Microsoft purchase of Intuit was scuttled in 1994 due to antitrust concerns that Microsoft would be purchasing a major competitor.
After bundling the Internet Explorer
Internet Explorer
Windows Internet Explorer is a series of graphical web browsers developed by Microsoft and included as part of the Microsoft Windows line of operating systems, starting in 1995. It was first released as part of the add-on package Plus! for Windows 95 that year...
web browser
Web browser
A web browser is a software application for retrieving, presenting, and traversing information resources on the World Wide Web. An information resource is identified by a Uniform Resource Identifier and may be a web page, image, video, or other piece of content...
into its Windows operating system in the late 1990s (without requiring a separate purchase) and acquiring a dominant share in the web browser market, the antitrust
Antitrust
The United States antitrust law is a body of laws that prohibits anti-competitive behavior and unfair business practices. Antitrust laws are intended to encourage competition in the marketplace. These competition laws make illegal certain practices deemed to hurt businesses or consumers or both,...
case United States v. Microsoft
United States v. Microsoft
United States v. Microsoft was a set of civil actions filed against Microsoft Corporation pursuant to the Sherman Antitrust Act of 1890 Section 1 and 2 on May 8, 1998 by the United States Department of Justice and 20 U.S. states. Joel I. Klein was the lead prosecutor...
was brought against the company. In a series of rulings by judge Thomas Penfield Jackson, the company was found to have violated its earlier consent decree and abused its monopoly in the desktop operating systems market. The "findings of fact" during the antitrust case established that Microsoft has a monopoly
Monopoly
A monopoly exists when a specific person or enterprise is the only supplier of a particular commodity...
in the PC desktop operating systems market:
Viewed together, three main facts indicate that Microsoft enjoys monopoly power. First, Microsoft's share of the market for Intel-compatible PC operating systems is extremely large and stable. Second, Microsoft's dominant market share is protected by a high barrier to entry. Third, and largely as a result of that barrier, Microsoft's customers lack a commercially viable alternative to Windows. (III.34)
The findings of fact go on to explain the nature of the "barrier to entry":
The fact that there is a multitude of people using Windows makes the product more attractive to consumers. The large installed base... impels ISVs (independent software vendors) to write applications first and foremost to Windows, thereby ensuring a large body of applications from which consumers can choose. The large body of applications thus reinforces demand for Windows, augmenting Microsoft's dominant position and thereby perpetuating ISV incentives to write applications principally for Windows... The small or non-existent market share of an aspiring competitor makes it prohibitively expensive for the aspirant to develop its PC operating system into an acceptable substitute for Windows. (III.39–40)
The proposed remedy (dividing Microsoft into two companies) was overturned on appeal. While new penalties were under consideration, the Clinton administration ended and the Bush administration took office. The new administration announced that in the interest of ending the case as quickly as possible, it would no longer seek to break the company up, and that it would stop investigating claims of illegal tying of products. Eighteen days later, Judge Kollar-Kotelly ordered the justice department and Microsoft to "engage in discussions seven days a week, 24 hours a day." The judge cited the events of September 11, 2001 in her direction to begin settlement talks but did not explain the linkage between the two. Attorney General Ashcroft, however, denied that the events of September 11 had any effect on the outcome. Microsoft subsequently reached a settlement with the Department of Justice
United States Department of Justice
The United States Department of Justice , is the United States federal executive department responsible for the enforcement of the law and administration of justice, equivalent to the justice or interior ministries of other countries.The Department is led by the Attorney General, who is nominated...
and some of the states which brought suit against it. Several class-action lawsuits filed after the conviction are still pending.
In early 2002, Microsoft proposed to settle the private lawsuits by donating $1 billion USD in money, software, services, and training, including Windows licenses and refurbished PCs, to about 12,500 underprivileged public schools. This was seen by some as a potential windfall for Microsoft, not only in educating schoolchildren on Microsoft solutions but also in collecting additional license fees if the schools ever wanted to upgrade. After protests from Apple Inc. which feared further loss of its educational market share, a federal judge rejected the proposed settlement.
In 2003–2004, the European Commission
European Commission
The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union's treaties and the general day-to-day running of the Union....
investigated the bundling of Windows Media Player
Windows Media Player
Windows Media Player is a media player and media library application developed by Microsoft that is used for playing audio, video and viewing images on personal computers running the Microsoft Windows operating system, as well as on Pocket PC and Windows Mobile-based devices...
into Windows, a practice which rivals complained was destroying the market for their own products. Negotiations between Microsoft and the Commission broke down in March 2004, and the company was subsequently handed down a record fine of €497 million ($666 million) for its breaches of EU competition law. Separate investigations into alleged abuses of the server market were also ongoing at the same time. On December 22, 2004, the European Court decided that the measures imposed on Microsoft by the European Commission would not be delayed, as was requested by Microsoft while waiting for the appeal. Microsoft has since paid a €497 million fine, shipped versions of Windows without Windows Media Player
Windows Media Player
Windows Media Player is a media player and media library application developed by Microsoft that is used for playing audio, video and viewing images on personal computers running the Microsoft Windows operating system, as well as on Pocket PC and Windows Mobile-based devices...
, and licensed many of the protocols used in its products to developers in countries within the European Economic Area. However, the European Commission has charactized the much delayed protocol licensing as unreasonable, called Microsoft "non-compliant" and still violating antitrust law in 2007, and said that its RAND
Reasonable and Non Discriminatory Licensing
Reasonable and non-discriminatory licensing is a type of licensing typically used during standardization processes. When joining a standardization body, companies normally agree that if they receive any patents on technologies which become essential to the standard they agree to allow other...
terms were above market prices; in addition, they said software patent
Software patent
Software patent does not have a universally accepted definition. One definition suggested by the Foundation for a Free Information Infrastructure is that a software patent is a "patent on any performance of a computer realised by means of a computer program".In 2005, the European Patent Office...
s covering the code "lack significant innovation", which Microsoft and the EC had agreed would determine licensing fees. Microsoft responded by saying, that other government agencies had found "considerable innovation". Microsoft appealed the facts and ruling to the European Court of First Instance with hearings in September 2006.
On September 17, 2007, the EU Court of First Instance rejected Microsoft's appeal.
The court affirmed the original contested finding:
All elements of Microsoft's appeal were dismissed.
Microsoft accepted the judgment of the Court of First Instance and proceeded to make available interoperability information as originally required by the European Commission.
Microsoft also faced competition law in South Korea and was fined $32 million in December 2005 and ordered to unbundle instant messaging, Windows Media Player and Windows Media Service, or let competitors' products take their place. Microsoft noted in their October 2005 SEC filing that they may have to pull out of South Korea, although they later denied fulfilling such a plan. Microsoft's 2006 appeal was struck down; they have another appeal pending.
European antitrust regulators on February 27, 2008 fined Microsoft $1.3 billion for failing to comply with a 2004 judgment, that the company had abused its market dominance. The new fine by the European Commission was the largest it has ever imposed on an individual company, and brings the total in fines imposed on Microsoft to about $US 2.5 billion, at current exchange rates.
Microsoft had previously been fined after the commission determined in 2004 that the company had abused the dominance of its Windows operating system to gain unfair market advantage. The commission imposing the new fine said, that it was because the company had not met the prescribed remedies after the earlier judgment.
European Union
The European Union Microsoft competition case is a case brought by the European CommissionEuropean Commission
The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union's treaties and the general day-to-day running of the Union....
of the European Union
European Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
(EU) against Microsoft
Microsoft
Microsoft Corporation is an American public multinational corporation headquartered in Redmond, Washington, USA that develops, manufactures, licenses, and supports a wide range of products and services predominantly related to computing through its various product divisions...
for abuse of its dominant position in the market (according to competition law
Competition law
Competition law, known in the United States as antitrust law, is law that promotes or maintains market competition by regulating anti-competitive conduct by companies....
). It started as a complaint from Novell
Novell
Novell, Inc. is a multinational software and services company. It is a wholly owned subsidiary of The Attachmate Group. It specializes in network operating systems, such as Novell NetWare; systems management solutions, such as Novell ZENworks; and collaboration solutions, such as Novell Groupwise...
over Microsoft's licensing practices in 1993, and eventually resulted in the EU ordering Microsoft to divulge certain information about its server products and release a version of Microsoft Windows
Microsoft Windows
Microsoft Windows is a series of operating systems produced by Microsoft.Microsoft introduced an operating environment named Windows on November 20, 1985 as an add-on to MS-DOS in response to the growing interest in graphical user interfaces . Microsoft Windows came to dominate the world's personal...
without Windows Media Player
Windows Media Player
Windows Media Player is a media player and media library application developed by Microsoft that is used for playing audio, video and viewing images on personal computers running the Microsoft Windows operating system, as well as on Pocket PC and Windows Mobile-based devices...
.
February 2008 fine
On February 27, 2008 the European Union (EU) competitions commission announced its decision to fine the Microsoft Corporation €
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
899 million (US$
United States dollar
The United States dollar , also referred to as the American dollar, is the official currency of the United States of America. It is divided into 100 smaller units called cents or pennies....
1.35 billion), approximately 1/10 of the company's net yearly earnings, for failing to comply with the 2004 antitrust order .
The first decision in this antitrust case was given in 2004 citing that Microsoft withheld needed interoperability
Interoperability
Interoperability is a property referring to the ability of diverse systems and organizations to work together . The term is often used in a technical systems engineering sense, or alternatively in a broad sense, taking into account social, political, and organizational factors that impact system to...
information from rival software companies which prevented them from making software compatible with Windows
Microsoft Windows
Microsoft Windows is a series of operating systems produced by Microsoft.Microsoft introduced an operating environment named Windows on November 20, 1985 as an add-on to MS-DOS in response to the growing interest in graphical user interfaces . Microsoft Windows came to dominate the world's personal...
. The commission ordered Microsoft to provide this information. Microsoft agreed to this, providing the information for royalty fees of 6.85% of the licensee's revenues for the product on grounds of innovation (specifically, 3.87% for the patent license and of 2.98% for the information license). The EU found these royalty fees unreasonable and Microsoft was ordered to lower them. Microsoft complied with this, adjusting the royalty rates to 1.2% (changing the rates for the licenses to 0.7% and 0.5%, respectively) in the European Union, while keeping the rate the same for the rest of the world. The EU still saw this as an unreasonable rate, and Microsoft, two month after lowering the rates, reduced the rates yet again to a flat rate of €10000 or a royalty of 0.4% applicable worldwide. Microsoft's royalty rates, which were deemed unreasonable for the period of 15 months between June 21, 2006 and October 21, 2007 are the cause for the fine. So far, the EU has fined Microsoft €1.68 billion in 3 separate fines in this case. This fine will go towards the European Union annual budget.
The European Anti-trust commissioner Neelie Kroes stated that the fine was "reasonable and proportionate," as the figure could have gone up as high as €1.5 billion, the maximum that the EU commission can impose. She also said that it should act as "a signal to the outside world, and especially Microsoft, that they should stick to the rules" and that "Talk is cheap. Flouting the rules is expensive." Although she also expressed hope that "today's decision closes a dark chapter in Microsoft's record of non-compliance with the Commission."
It is not certain whether Microsoft will appeal this decision. A Microsoft spokesperson has stated that Microsoft will review this latest fine, citing that "The commission announced in October 2007 that Microsoft was in full compliance with the 2004 decision, so these fines are about the past issues that have been resolved." Microsoft's General Counsel Brad Smith commented "It's clearly very important to us as a company that we comply with our obligations under European law. We will study this decision carefully, and if there are additional steps that we need to take in order to comply with it, we will take them." Microsoft had appealed against fines by the EU before, but all the charges were defeated. If Microsoft does not appeal the decision, the company will have 3 months (starting February 27) to pay the fine in full.
The decisions came after Microsoft announced they were disclosing 30,000 pages of previously secret software code last Thursday (February 21). The EU competition commissioner commented that this move "does not necessarily equal a change in business practice."
Spanish anti-trust investigation
In September 2011, the competition commission in Spain
Spain
Spain , officially the Kingdom of Spain languages]] under the European Charter for Regional or Minority Languages. In each of these, Spain's official name is as follows:;;;;;;), is a country and member state of the European Union located in southwestern Europe on the Iberian Peninsula...
began an investigation into Microsoft's licence agreements, which prevent the transfer of Microsoft software to third parties.
United States
United States v. Microsoft, 87 F. Supp. 2d 30Case citation
Case citation is the system used in many countries to identify the decisions in past court cases, either in special series of books called reporters or law reports, or in a 'neutral' form which will identify a decision wherever it was reported...
(D.D.C. 2000) was a set of consolidated civil actions filed against Microsoft Corporation on May 18, 1998 by the United States Department of Justice
United States Department of Justice
The United States Department of Justice , is the United States federal executive department responsible for the enforcement of the law and administration of justice, equivalent to the justice or interior ministries of other countries.The Department is led by the Attorney General, who is nominated...
(DOJ) and twenty U.S. states. Joel I. Klein
Joel Klein
Joel Irwin Klein was Chancellor of the New York City Department of Education, the largest public school system in the United States, serving more than 1.1 million students in more than 1,600 schools...
was the lead prosecutor. The plaintiffs alleged that Microsoft abused monopoly
Monopoly
A monopoly exists when a specific person or enterprise is the only supplier of a particular commodity...
power in its handling of operating system
Operating system
An operating system is a set of programs that manage computer hardware resources and provide common services for application software. The operating system is the most important type of system software in a computer system...
sales and web browser
Web browser
A web browser is a software application for retrieving, presenting, and traversing information resources on the World Wide Web. An information resource is identified by a Uniform Resource Identifier and may be a web page, image, video, or other piece of content...
sales. The issue central to the case was whether Microsoft was allowed to bundle its flagship Internet Explorer
Internet Explorer
Windows Internet Explorer is a series of graphical web browsers developed by Microsoft and included as part of the Microsoft Windows line of operating systems, starting in 1995. It was first released as part of the add-on package Plus! for Windows 95 that year...
(IE) web browser software with its Microsoft Windows
Microsoft Windows
Microsoft Windows is a series of operating systems produced by Microsoft.Microsoft introduced an operating environment named Windows on November 20, 1985 as an add-on to MS-DOS in response to the growing interest in graphical user interfaces . Microsoft Windows came to dominate the world's personal...
operating system. Bundling them together is alleged to have been responsible for Microsoft's victory in the browser wars
Browser wars
Browser wars is a metaphorical term that refers to competitions for dominance in usage share in the web browser marketplace. The term is often used to denote two specific rivalries: the competition that saw Microsoft's Internet Explorer replace Netscape's Navigator as the dominant browser during...
as every Windows user had a copy of Internet Explorer. It was further alleged that this unfairly restricted the market for competing web browsers (such as Netscape Navigator
Netscape Navigator
Netscape Navigator was a proprietary web browser that was popular in the 1990s. It was the flagship product of the Netscape Communications Corporation and the dominant web browser in terms of usage share, although by 2002 its usage had almost disappeared...
or Opera
Opera (web browser)
Opera is a web browser and Internet suite developed by Opera Software with over 200 million users worldwide. The browser handles common Internet-related tasks such as displaying web sites, sending and receiving e-mail messages, managing contacts, chatting on IRC, downloading files via BitTorrent,...
) that were slow to download over a modem or had to be purchased at a store. Underlying these disputes were questions over whether Microsoft altered or manipulated its application programming interface
Application programming interface
An application programming interface is a source code based specification intended to be used as an interface by software components to communicate with each other...
s (APIs) to favor Internet Explorer over third party web browsers, Microsoft's conduct in forming restrictive licensing agreements with OEM
Original Equipment Manufacturer
An original equipment manufacturer, or OEM, manufactures products or components that are purchased by a company and retailed under that purchasing company's brand name. OEM refers to the company that originally manufactured the product. When referring to automotive parts, OEM designates a...
computer manufacturers, and Microsoft's intent in its course of conduct.
Microsoft stated that the merging of Microsoft Windows and Internet Explorer was the result of innovation
Innovation
Innovation is the creation of better or more effective products, processes, technologies, or ideas that are accepted by markets, governments, and society...
and competition
Competition
Competition is a contest between individuals, groups, animals, etc. for territory, a niche, or a location of resources. It arises whenever two and only two strive for a goal which cannot be shared. Competition occurs naturally between living organisms which co-exist in the same environment. For...
, that the two were now the same product and were inextricably linked together and that consumers were now getting all the benefits of IE for free. Those who opposed Microsoft's position countered that the browser was still a distinct and separate product which did not need to be tied to the operating system, since a separate version of Internet Explorer was available for Mac OS
Mac OS
Mac OS is a series of graphical user interface-based operating systems developed by Apple Inc. for their Macintosh line of computer systems. The Macintosh user experience is credited with popularizing the graphical user interface...
. They also asserted that IE was not really free because its development and marketing costs may have kept the price of Windows higher than it might otherwise have been. The case was tried before U.S. District Court Judge Thomas Penfield Jackson
Thomas Penfield Jackson
Thomas Penfield Jackson is a former United States District Court Judge for the District of Columbia....
. The DOJ was initially represented by David Boies
David Boies
David Boies is an American lawyer and chairman of the law firm Boies, Schiller & Flexner. He has been involved in various high-profile cases in the United States.-Early life and education:...
.
Other
In March 2004, during a consumer class-action lawsuit in Minnesota, internal documents subpoenaed from Microsoft revealed that the company had violated nondisclosure agreements seven years earlier in obtaining business plans from Go Corporation, using them to develop and announce a competing product named PenWindows, and convincing Intel to reduce its investment in Go. After Go was purchased by AT&TAT&T
AT&T Inc. is an American multinational telecommunications corporation headquartered in Whitacre Tower, Dallas, Texas, United States. It is the largest provider of mobile telephony and fixed telephony in the United States, and is also a provider of broadband and subscription television services...
and Go's tablet-based computing efforts were shelved, PenWindows development was dropped.
In May 2004, a class-action lawsuit accused Microsoft of overcharging customers in the state of California. The company settled the case for $1.1 billion, and a California court ordered Microsoft to pay an additional $258 million in legal fees (including over $3,000 per hour for the lead attorney in the case, more than $2,000 per hour for colleagues, and in excess of $1,000 per hour for administrative work). A Microsoft attorney responded, "Somebody ends up paying for this. These large fee awards get passed on to consumers." The total bill for legal fees was later reduced to just over $112 million. Because of the structure of the settlement, the law firm which sued Microsoft could end up getting more money from the company than California consumers and schools, the beneficiaries of the settlement.
In 2006 Microsoft initiated an investigation of Lithuania
Lithuania
Lithuania , officially the Republic of Lithuania is a country in Northern Europe, the biggest of the three Baltic states. It is situated along the southeastern shore of the Baltic Sea, whereby to the west lie Sweden and Denmark...
n government institutions for determining whether they choose long-term strategies of the software they use correctly. The investigation, funded by Microsoft itself, will be performed by the Vilnius University
Vilnius University
Vilnius University is the oldest university in the Baltic states and one of the oldest in Eastern Europe. It is also the largest university in Lithuania....
together with the Lithuanian Institution of the Free Market, a think tank
Think tank
A think tank is an organization that conducts research and engages in advocacy in areas such as social policy, political strategy, economics, military, and technology issues. Most think tanks are non-profit organizations, which some countries such as the United States and Canada provide with tax...
organization. The investigation was initialised after the government started to prepare 860 thousand litas project to encourage the use of open-source software. The vice-president of Microsoft, Vahe Torossian, stated that "the government should not be technologically subjectivist"
Microsoft was sued for the "Windows Vista Capable" logo
and in Iowa
Iowa
Iowa is a state located in the Midwestern United States, an area often referred to as the "American Heartland". It derives its name from the Ioway people, one of the many American Indian tribes that occupied the state at the time of European exploration. Iowa was a part of the French colony of New...
. Microsoft Word
Microsoft Word
Microsoft Word is a word processor designed by Microsoft. It was first released in 1983 under the name Multi-Tool Word for Xenix systems. Subsequent versions were later written for several other platforms including IBM PCs running DOS , the Apple Macintosh , the AT&T Unix PC , Atari ST , SCO UNIX,...
was also a subject of court case.
Private
Microsoft has also fought numerous legal battles against private companies. The most prominent ones are against:- Alcatel-LucentAlcatel-LucentAlcatel-Lucent is a global telecommunications corporation, headquartered in the 7th arrondissement of Paris, France. It provides telecommunications solutions to service providers, enterprises, and governments around the world, enabling these customers to deliver voice, data, and video services...
, which won US$1.52 billion in a lawsuit which alleged that Microsoft had infringed its patents on playback of audio files. This ruling was overturned in a higher court - Apple Inc. (known as Apple Computer, Inc. at the time), which accused Microsoft in the late 1980s of copying the "look and feel" of the graphical user interface of Apple's operating systems. The courts ruled in favor of MicrosoftApple Computer, Inc. v. Microsoft Corp.Apple Computer, Inc. v. Microsoft Corporation, 35 F.3d 1435 was a copyright infringement lawsuit in which Apple Computer, Inc. sought to prevent Microsoft Corporation and Hewlett-Packard from using visual graphical user interface elements that were similar to those in Apple's Lisa and Macintosh...
in 1994. Another suit by Apple accused Microsoft, along with Intel and the San Francisco Canyon CompanySan Francisco Canyon CompanySan Francisco Canyon Company was a software developer company that was contracted by Apple Computer in 1992 to port the QuickTime technology to Microsoft Windows...
, in 1995 of knowingly stealing several thousand lines of QuickTimeQuickTimeQuickTime is an extensible proprietary multimedia framework developed by Apple Inc., capable of handling various formats of digital video, picture, sound, panoramic images, and interactivity. The classic version of QuickTime is available for Windows XP and later, as well as Mac OS X Leopard and...
source code in an effort to improve the performance of Video for WindowsVideo for WindowsVideo for Windows was a multimedia framework developed by Microsoft that allowed Microsoft Windows to play digital video.-Overview:...
. After a threat to withdraw support for Office for Mac, this lawsuit was ultimately settled in 1997. Apple agreed to make Internet Explorer the default browser over Netscape, and Microsoft agreed to continue developing Office and other software for the Mac for the next 5 years, purchase $150 million of non-voting Apple stock, and made a quiet payoff estimated to be in the US$500 million-$2 billion range. - AOLAOLAOL Inc. is an American global Internet services and media company. AOL is headquartered at 770 Broadway in New York. Founded in 1983 as Control Video Corporation, it has franchised its services to companies in several nations around the world or set up international versions of its services...
, on behalf of its NetscapeNetscapeNetscape Communications is a US computer services company, best known for Netscape Navigator, its web browser. When it was an independent company, its headquarters were in Mountain View, California...
division. Netscape (as an independent company) also was involved in the United States v. MicrosoftUnited States v. MicrosoftUnited States v. Microsoft was a set of civil actions filed against Microsoft Corporation pursuant to the Sherman Antitrust Act of 1890 Section 1 and 2 on May 8, 1998 by the United States Department of Justice and 20 U.S. states. Joel I. Klein was the lead prosecutor...
antitrust suit. - Be Inc.Be Inc.Be Incorporated was an American computer company founded in 1990, best known for the Be Operating System and BeBox personal computer. Be was founded by former Apple Computer executive Jean-Louis Gassée with capital from Seymour Cray....
, which accused Microsoft of exclusionary and anticompetitive behavior intended to drive Be out of the market. Be even offered to license its Be Operating SystemBeOSBeOS is an operating system for personal computers which began development by Be Inc. in 1991. It was first written to run on BeBox hardware. BeOS was optimized for digital media work and was written to take advantage of modern hardware facilities such as symmetric multiprocessing by utilizing...
(BeOS) for free to any PC vendors who would ship it pre-installed, but the vendors declined due to what Be believes were fears of pricing retaliation from Microsoft: by raising the price of Microsoft Windows for one particular PC vendor, Microsoft could price that vendor's PCs out of the market. - Bristol Technology Inc.Bristol Technology Inc.Bristol Technology Inc. was a software development company founded in January 1991 by Keith, Ken, and Jean Blackwell. The company's original product idea, Wind/U, was an implementation of the Windows API on non-Windows operating systems...
, which accused Microsoft illegally withheld Windows source code and used its dominant position with Windows to move into other markets. A ruling later ordered Microsoft to pay $1 Million to Bristol Technologies (see also Windows Interface Source EnvironmentWindows Interface Source EnvironmentWindows Interface Source Environment was a licensing program from Microsoft which allowed developers to recompile and run Windows-based applications on UNIX and Macintosh platforms....
). - CalderaSCO GroupTSG Group, Inc. is a software company formerly called The SCO Group, Caldera Systems, and Caldera International. After acquiring the Santa Cruz Operation's Server Software and Services divisions, as well as UnixWare and OpenServer technologies, the company changed its focus to UNIX...
, which accused Microsoft of having modified Windows 3.1 so that it would not run on DR DOS 6 although there was no technical reason for it not to work. Some claim that Microsoft put encrypted code in five otherwise unrelated Microsoft programs in order to prevent the functioning of DR DOS in pre-releases (beta versions) of Windows 3.1. Microsoft settled out-of-court for an undisclosed sum. - OperaOpera (web browser)Opera is a web browser and Internet suite developed by Opera Software with over 200 million users worldwide. The browser handles common Internet-related tasks such as displaying web sites, sending and receiving e-mail messages, managing contacts, chatting on IRC, downloading files via BitTorrent,...
, which accused Microsoft of intentionally making its MSN service incompatible with the Opera browser on several occasions. - SendoSendoSendo was a British Birmingham, England-based manufacturer and supplier of mobile phones founded in 1999. The company went into administration in June 2005 and its technology was bought by Motorola....
, which accused Microsoft of terminating their partnership so it could steal Sendo's technology to use in Windows Smartphone 2002. - Spyglass, which licensed its browser to Microsoft in return for a percentage of each sale; Microsoft turned the browser into Internet Explorer and bundled it with Windows, giving it away to gain market share but effectively destroying any chance of Spyglass making money from the deal they had signed with Microsoft; Spyglass sued for deception and won a $8 million settlement.
- Stac ElectronicsStac ElectronicsStac Electronics, originally incorporated as State of the Art Consulting and later shortened to Stac, Inc, was a technology company founded in 1983...
, which accused Microsoft of stealing its data compression code and using it in MS-DOS 6. Microsoft eventually lost the subsequent lawsuit and was ordered by a federal court to pay roughly $120 million in compensation. - Sun Microsystems, which held Microsoft in violation of contract for including a modified version of Java in Microsoft Windows that provided Windows-specific extensions to Sun's Java language; Microsoft lost this decision in court and were forced to stop shipping their Windows-specific Java Virtual MachineJava Virtual MachineA Java virtual machine is a virtual machine capable of executing Java bytecode. It is the code execution component of the Java software platform. Sun Microsystems stated that there are over 4.5 billion JVM-enabled devices.-Overview:...
. Microsoft eventually ceased to include any Java Virtual Machine in Windows, and Windows users who require a Java Virtual Machine need to download the software or otherwise acquire a copy from a source other than Microsoft. - WordPerfectWordPerfectWordPerfect is a word processing application, now owned by Corel.Bruce Bastian, a Brigham Young University graduate student, and BYU computer science professor Dr. Alan Ashton joined forces to design a word processing system for the city of Orem's Data General Corp. minicomputer system in 1979...
- Zhongyi Electronic, which, having licensed two self-designed fonts to Microsoft for use only in Windows 95, filed suit in China in April, 2007, accusing Microsoft of using those fonts in subsequent Windows 98, 2000, XP, 2003 and four other Chinese-language Windows operating systems. Beijing's No. 1 Intermediate People's CourtIntermediate people's courtAn intermediate people's court is the second lowest local people's court in the People's Republic of China. According to the Organic Law of the People's Courts of the People's Republic of China, the intermediate people's courts handle relevant important local cases in the first instance and hear...
ruled on November 16, 2009 that Microsoft violated the scope of licensing agreements between the two companies. The result of the verdict is that Microsoft has to stop selling Chinese-language versions of the aforementioned operating systems. Microsoft said it will appeal. One of the fonts in question may be SimSun. - Many other smaller companies have filed patent abuse and predatory practice suits against Microsoft.
Alcatel-Lucent
The dispute between Microsoft and Lucent (and later Alcatel-Lucent) began in 2003 when Lucent TechnologiesLucent Technologies
Alcatel-Lucent USA, Inc., originally Lucent Technologies, Inc. is a French-owned technology company composed of what was formerly AT&T Technologies, which included Western Electric and Bell Labs...
(acquired by Alcatel
Alcatel
Alcatel Mobile Phones is a brand of mobile handsets. It was established in 2004 as a joint venture between Alcatel-Lucent of France and TCL Communication of China....
in 2006) filed suit against Gateway
Gateway, Inc.
Gateway Computer Corporation, is a computer hardware company headquartered in Irvine, California, USA which develops, manufactures, supports, and markets a wide range of personal computers, computer monitors, servers, and computer accessories...
in the U.S. District Court for the Southern District of California
United States District Court for the Southern District of California
The United States District Court for the Southern District of California is the federal district court whose jurisdiction comprises the following counties in California: Imperial and San Diego. In terms of filed indictments, it is one of the busiest criminal districts in the United States...
in San Diego. Lucent also sued Dell
Dell
Dell, Inc. is an American multinational information technology corporation based in 1 Dell Way, Round Rock, Texas, United States, that develops, sells and supports computers and related products and services. Bearing the name of its founder, Michael Dell, the company is one of the largest...
in the U.S. District Court for the Eastern District of Virginia
United States District Court for the Eastern District of Virginia
The United States District Court for the Eastern District of Virginia is one of two United States district courts serving the Commonwealth of Virginia...
; soon thereafter, that court transferred the Dell case to San Diego, where it was consolidated with the case against Gateway. Lucent claimed in this first San Diego case that Dell and Gateway had violated patents on MP3-related technologies developed by Bell Labs
Bell Labs
Bell Laboratories is the research and development subsidiary of the French-owned Alcatel-Lucent and previously of the American Telephone & Telegraph Company , half-owned through its Western Electric manufacturing subsidiary.Bell Laboratories operates its...
, a division of predecessor company American Telephone & Telegraph
American Telephone & Telegraph
AT&T Corp., originally American Telephone and Telegraph Company, is an American telecommunications company that provides voice, video, data, and Internet telecommunications and professional services to businesses, consumers, and government agencies. AT&T is the oldest telecommunications company...
. Other patents said to be infringed relate to MPEG video technology, speech technology, internet technology, and other technologies. Microsoft intervened in the lawsuit in April 2003 and Alcatel was added after it acquired Lucent.
After the first San Diego lawsuit was filed, Microsoft and Lucent have filed additional patent lawsuits against each other. In February 2007, Microsoft filed a lawsuit at the International Trade Commission claiming that Alcatel-Lucent infringed its patents. There is a second case in San Diego where Microsoft is asserting that Alcatel-Lucent infringes 10 of its patents, and yet another case in Texas where each alleges that the other is infringing its patents.
Burst.com
- Burst.com claims that Microsoft stole Burst's patented technology for delivering high speed streaming sound and video content on the internet. Also at issue in the case is a 35-week period of missing emails in the evidence Microsoft handed over to Burst which was discovered by Burst.com's lawyers. Burst accuses Microsoft of crafting a 30 day email deletion policy specifically to cover up illegal activity. Microsoft settled with the company for $60 million in exchange for an agreement to license some of the company's technologies.
Eolas
- EolasEolasEolas is a United States technology company. It was founded in 1994 by sole employee Michael David Doyle. His University of California, San Francisco team has claimed to have created the first web browser that supported plugins...
and University of CaliforniaUniversity of CaliforniaThe University of California is a public university system in the U.S. state of California. Under the California Master Plan for Higher Education, the University of California is a part of the state's three-tier public higher education system, which also includes the California State University...
, which accused Microsoft of using some of its software patents in their web browser, won $521 million in court.
Apple
Apple Computer Inc. v. Microsoft Corporation, 35 F.3d 1435Case citation
Case citation is the system used in many countries to identify the decisions in past court cases, either in special series of books called reporters or law reports, or in a 'neutral' form which will identify a decision wherever it was reported...
(9th Cir. 1994) was a copyright infringement
Copyright infringement
Copyright infringement is the unauthorized or prohibited use of works under copyright, infringing the copyright holder's exclusive rights, such as the right to reproduce or perform the copyrighted work, or to make derivative works.- "Piracy" :...
lawsuit in which Apple Computer, Inc. (now Apple Inc.) sought to prevent Microsoft Corporation and Hewlett-Packard
Hewlett-Packard
Hewlett-Packard Company or HP is an American multinational information technology corporation headquartered in Palo Alto, California, USA that provides products, technologies, softwares, solutions and services to consumers, small- and medium-sized businesses and large enterprises, including...
from using visual graphical user interface
Graphical user interface
In computing, a graphical user interface is a type of user interface that allows users to interact with electronic devices with images rather than text commands. GUIs can be used in computers, hand-held devices such as MP3 players, portable media players or gaming devices, household appliances and...
(GUI) elements that were similar to those in Apple's Lisa
Apple Lisa
The Apple Lisa—also known as the Lisa—is a :personal computer designed by Apple Computer, Inc. during the early 1980s....
and Macintosh operating system
Operating system
An operating system is a set of programs that manage computer hardware resources and provide common services for application software. The operating system is the most important type of system software in a computer system...
s. Some critics claimed that Apple was really attempting to gain all intellectual property
Intellectual property
Intellectual property is a term referring to a number of distinct types of creations of the mind for which a set of exclusive rights are recognized—and the corresponding fields of law...
rights over the desktop metaphor
Desktop metaphor
The desktop metaphor is an interface metaphor which is a set of unifying concepts used by graphical user interfaces to help users more easily interact with the computer. The desktop metaphor treats the monitor of a computer as if it is the user's desktop, upon which objects such as documents and...
for computer interfaces, and perhaps all GUIs, on personal computer
Personal computer
A personal computer is any general-purpose computer whose size, capabilities, and original sales price make it useful for individuals, and which is intended to be operated directly by an end-user with no intervening computer operator...
s. Apple lost all claims in the lawsuit, except that the court ruled that the "trash can" icon and file folder icons from Hewlett-Packard's now-forgotten NewWave
NewWave (HP software)
NewWave was an object-oriented graphical desktop environment and office productivity tool for PCs running early versions of Microsoft Windows . It was developed by Hewlett-Packard and introduced c. 1989...
windows application were infringing. The lawsuit was filed in 1988 and lasted four years; the decision was affirmed on appeal in 1994, and Apple's appeal to the U.S. Supreme Court was denied.
Lindows
Microsoft v. Lindows.com, Inc. was a court caseLegal case
A legal case is a dispute between opposing parties resolved by a court, or by some equivalent legal process. A legal case may be either civil or criminal...
brought by Microsoft
Microsoft
Microsoft Corporation is an American public multinational corporation headquartered in Redmond, Washington, USA that develops, manufactures, licenses, and supports a wide range of products and services predominantly related to computing through its various product divisions...
against Lindows, Inc
Linspire
Linspire, previously known as LindowsOS, was a commercial operating system based on Debian GNU/Linux and later Ubuntu. Linspire was published by Linspire, Inc. and focused on ease-of-use, targeting home PC users...
, claiming that the name "Lindows" was a violation of its trademark
Trademark
A trademark, trade mark, or trade-mark is a distinctive sign or indicator used by an individual, business organization, or other legal entity to identify that the products or services to consumers with which the trademark appears originate from a unique source, and to distinguish its products or...
"Windows." In addition to the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, Microsoft has also sued Lindows in Sweden
Sweden
Sweden , officially the Kingdom of Sweden , is a Nordic country on the Scandinavian Peninsula in Northern Europe. Sweden borders with Norway and Finland and is connected to Denmark by a bridge-tunnel across the Öresund....
, France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
, Belgium
Belgium
Belgium , officially the Kingdom of Belgium, is a federal state in Western Europe. It is a founding member of the European Union and hosts the EU's headquarters, and those of several other major international organisations such as NATO.Belgium is also a member of, or affiliated to, many...
, Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
, The Netherlands
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
and Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
. Michael Robertson has called this situation "Sextuple Jeopardy", an extension of the term double jeopardy
Double jeopardy
Double jeopardy is a procedural defense that forbids a defendant from being tried again on the same, or similar charges following a legitimate acquittal or conviction...
.
In response to these lawsuits, Lindows had launched ChoicePC.com, which allows people to purchase lifetime Lindows memberships that includes a free copy of LindowsOS, free LindowsOS upgrades for life, and a ChoicePC.com t-shirt, for $100 USD
United States dollar
The United States dollar , also referred to as the American dollar, is the official currency of the United States of America. It is divided into 100 smaller units called cents or pennies....
. All money from the memberships goes towards helping Lindows in its legal battle against Microsoft.
MikeRoweSoft
In a legal dispute, Microsoft sued a CanadianCanada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
high school student named Mike Rowe over the domain name
Domain name
A domain name is an identification string that defines a realm of administrative autonomy, authority, or control in the Internet. Domain names are formed by the rules and procedures of the Domain Name System ....
MikeRoweSoft.com. The case received international press attention following Microsoft's perceived heavy handed approach to a 12th grade student's part time web design
Web design
Web design is the process of planning and creating a website. Text, images, digital media and interactive elements are used by web designers to produce the page seen on the web browser...
business and the subsequent support that Rowe received from the online community. A settlement was eventually agreed, with Rowe granting ownership of the domain to Microsoft in return for training and gifts.
Windows Commander
From 1993 until 2002, Total CommanderTotal Commander
Total Commander is an Orthodox File Manager software for Windows, Windows CE, and Windows Mobile. Some features include a built-in FTP client, file compare, archive file navigation, and a versatile multi-rename tool with regular expression support....
was called Windows Commander; the name was changed in 2002 out of fear of a lawsuit after the developers received a letter from Microsoft pointing out that the word "windows" was trademarked by Microsoft.
wxWindows
The wxWindows project was renamed to wxWidgetsWxWidgets
wxWidgets is a widget toolkit for creating graphical user interfaces for cross-platform applications. wxWidgets enables a program's GUI code to compile and run on several computer platforms with minimal or no code changes...
in September 2003 out of fear of a lawsuit after the founder developer Julian Smart received a letter from Microsoft pointing out that the 'Windows
Microsoft Windows
Microsoft Windows is a series of operating systems produced by Microsoft.Microsoft introduced an operating environment named Windows on November 20, 1985 as an add-on to MS-DOS in response to the growing interest in graphical user interfaces . Microsoft Windows came to dominate the world's personal...
' is a UK trademark owned by Microsoft.
Microwindows
The MicrowindowsMicrowindows
Microwindows is a windowing system which is full featured enough to be used on a PC or a PDA. The Nano-X Window System is an Open Source project aimed at bringing the features of modern graphical windowing environments to smaller devices and platforms...
project was renamed to Nano-X Window System in January 2005, due to legal threats from Microsoft regarding the Windows
Microsoft Windows
Microsoft Windows is a series of operating systems produced by Microsoft.Microsoft introduced an operating environment named Windows on November 20, 1985 as an add-on to MS-DOS in response to the growing interest in graphical user interfaces . Microsoft Windows came to dominate the world's personal...
trademark.
Xbox 360
Microsoft has been accused of deceiving consumers by concealing the high failure rate of its Xbox 360Xbox 360
The Xbox 360 is the second video game console produced by Microsoft and the successor to the Xbox. The Xbox 360 competes with Sony's PlayStation 3 and Nintendo's Wii as part of the seventh generation of video game consoles...
game machine. A woman from California
California
California is a state located on the West Coast of the United States. It is by far the most populous U.S. state, and the third-largest by land area...
sued Microsoft on October 2008 in Superior Court in Sacramento County, stating that the company violated multiple state consumer-protection and unfair-competition laws. The woman alleged that the company continued to sell the Xbox 360 even though it knew that the console's hardware was likely to fail.
License refunds and EULA suits
A Windows refund is a type of refund claimed by a user when they purchase a computer with the Microsoft WindowsMicrosoft Windows
Microsoft Windows is a series of operating systems produced by Microsoft.Microsoft introduced an operating environment named Windows on November 20, 1985 as an add-on to MS-DOS in response to the growing interest in graphical user interfaces . Microsoft Windows came to dominate the world's personal...
operating system
Operating system
An operating system is a set of programs that manage computer hardware resources and provide common services for application software. The operating system is the most important type of system software in a computer system...
pre-installed on it. The refund is issued by the hardware manufacturer, or occasionally the retailer, for the copy of Microsoft Windows, rather than the whole computer. Due to Microsoft's dominance in desktop computing and a lack of understanding on the manufacturer's or retailer's part, it is often difficult (but not impossible) for users to obtain a refund.
In 2006, a British man purchased a Dell Inspiron
Dell Inspiron
Dell's Inspiron computer product line started as a range of laptop computers targeted at the entry-level, budget, a Mobile Celeron or Mobile Pentium II processor with SDRAM, and had a high starting price of $2,799...
640 m laptop
Laptop
A laptop, also called a notebook, is a personal computer for mobile use. A laptop integrates most of the typical components of a desktop computer, including a display, a keyboard, a pointing device and speakers into a single unit...
bundled with Microsoft Windows XP Home SP2 preinstalled, but he did not accept Microsoft's End User License Agreement (EULA)
Software license agreement
A software license agreement is a contract between the "licensor" and purchaser of the right to use software. The license may define ways under which the copy can be used, in addition to the automatic rights of the buyer including the first sale doctrine and .Many form contracts are only contained...
. In one week after his response, the customer received a "goodwill" refund of GBP
Pound sterling
The pound sterling , commonly called the pound, is the official currency of the United Kingdom, its Crown Dependencies and the British Overseas Territories of South Georgia and the South Sandwich Islands, British Antarctic Territory and Tristan da Cunha. It is subdivided into 100 pence...
£47 (£55.23 including tax) from Dell
Dell
Dell, Inc. is an American multinational information technology corporation based in 1 Dell Way, Round Rock, Texas, United States, that develops, sells and supports computers and related products and services. Bearing the name of its founder, Michael Dell, the company is one of the largest...
for a no Windows option, as the copy of the system was an "unused product" according to the software license agreement. Dell had not asked for the installation medium to be returned and commented that although it does not have a Windows refund program, giving a refund in an individual case is not forbidden either.
In a civil suit, Italian court rejected HP's argument that the licensing conditions had been set unilaterally by Microsoft and ruled HP to reimburse customer the amount of 90 euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
for unused Windows XP bundled with Compaq
Compaq
Compaq Computer Corporation is a personal computer company founded in 1982. Once the largest supplier of personal computing systems in the world, Compaq existed as an independent corporation until 2002, when it was acquired for US$25 billion by Hewlett-Packard....
notebook. The court was of the opinion that HP had to know about the conditions, because they most likely constituted part of the agreement between them and Microsoft. It also found the fact that computers without an operating system are available on the market to be irrelevant. According Süddeutsche Zeitung
Süddeutsche Zeitung
The Süddeutsche Zeitung , published in Munich, is the largest German national subscription daily newspaper.-Profile:The title literally translates as "South German Newspaper". It is read throughout Germany by 1.1 million readers daily and boasts a relatively high circulation abroad...
, a German Dell customer replaced the preinstalled Windows with Linux
Linux
Linux is a Unix-like computer operating system assembled under the model of free and open source software development and distribution. The defining component of any Linux system is the Linux kernel, an operating system kernel first released October 5, 1991 by Linus Torvalds...
and had been credited the amount of €78 for operating system and a further unspecified Microsoft program. A French court ruled Acer to refund the purchase price of preinstalled laptop software, of which was €135.20 for Windows XP Home. An Israeli Dell customer received $137 as refund for Windows Vista
Windows Vista
Windows Vista is an operating system released in several variations developed by Microsoft for use on personal computers, including home and business desktops, laptops, tablet PCs, and media center PCs...
.
Lenovo Czech Republic wanted its customer to sign a non-disclosure agreement
Non-disclosure agreement
A non-disclosure agreement , also known as a confidentiality agreement , confidential disclosure agreement , proprietary information agreement , or secrecy agreement, is a legal contract between at least two parties that outlines confidential material, knowledge, or information that the parties...
before Windows licence refund to prevent him from talking about the deal, but the customer refused and took the story to local Linux web portal AbcLinuxu.cz, which gave him an equivalent amount of money for telling his story to the world.
$500 billion arbitration
An ArkansasArkansas
Arkansas is a state located in the southern region of the United States. Its name is an Algonquian name of the Quapaw Indians. Arkansas shares borders with six states , and its eastern border is largely defined by the Mississippi River...
-native by the name of David Stebbins has recently filed a lawsuit against Microsoft, attempting to confirm an arbitration award
Arbitration award
An arbitration award is a determination on the merits by an arbitration tribunal in an arbitration, and is analogous to a judgment in a court of law...
in the amount of $500 billion. He claims that his basis for the suit is that he is holding corporations to the same contract modification practices that they often use on customers. According to Stebbins, corporations can, and often do, unilaterally amend the terms of their contracts, often in subtle and inconspicuous ways.
Stebbins decided to "give them a taste of their own medicine" and sent notice to Microsoft stating the terms of his Xbox Live
Xbox Live
Xbox Live is an online multiplayer gaming and digital media delivery service created and operated by Microsoft Corporation. It is currently the only online gaming service on consoles that charges users a fee to play multiplayer gaming. It was first made available to the Xbox system in 2002...
gaming contract that he
Arbitration clause
An arbitration clause is a commonly used clause in a contract that requires the parties to resolve their disputes through an arbitration process...
requiring Microsoft to respond to an invitation of legal arbitration within 24 hours, and also what Stebbins refers to as a "forfeit victory clause," stating that, if Microsoft does not respond to the arbitration within the 24-hour time frame, Stebbins automatically wins. He initiated an arbitration against Microsoft, claiming $500 billion in damages, but Microsoft did not respond, and Stebbins is now attempting to confirm the arbitration award.
Microsoft has declined to comment.