Legal Update

While waiting to learn if the U.S. Supreme Court will hear its appeal in the Department of Justice (DoJ) antitrust case, Microsoft has received bad news on other legal fronts.

• A California judge will allow a set of private antitrust suits against Microsoft to proceed as a class action. This is the first, but possibly not the last, state-level antitrust suit to capitalize on the DoJ case and survive early legal tests. The California plaintiffs claim that Microsoft’s anticompetitive practices artificially raised prices for all Californians who purchased MS-DOS, Windows, Word, and Excel in California since May 1994. Citing the Nov. 1999 Findings of Fact in the DoJ case, Judge Stuart Pollak of the California Superior Court said the plaintiffs had raised claims that could legally proceed to trial. The plaintiffs still face what the judge called the “formidable, but not impossible” task of proving that Microsoft’s conduct harmed the class of consumers. In California and a minority of other U.S. states, consumers can sue for anticompetitive practices even if they didn’t buy a product directly from the defendant, but they must show that resellers passed on measurably higher costs. Microsoft’s information page for the case (which links to the ruling) is www.microsoft.com/presspass/legal/ca.