Updated: Novell accepts $536 million to settle anti-trust case with Microsoft

By Alun Williams

Posted on 8 Nov 2004 at 15:01

Novell has settled its long-standing NetWare anti-trust claim with Microsoft - to the tune of $536 - but in the same announcement reveals plans to launch a second claim relating to WordPerfect.

Under terms of the settlement, in exchange for the cash payment, Novell has dropped its suit alleging that Microsoft illegally used its near monopoly of the PC operating system market to force Netware out of the market. As part ot the agreement novell will withdraw its intervention in the European Commission's case with Microsoft.

'We are pleased that we have been able to resolve a portion of our pending legal issues with Microsoft,' said Joseph A. LaSala, Jr, Novell's senior VP and general counsel. 'This is a significant settlement, particularly since we were able to achieve our objectives without filing expensive litigation. While we have agreed to withdraw from the EU case, we think our involvement there has been useful, as it has assisted the European proceedings and facilitated a favourable settlement with Microsoft.'

'With the EU case now on appeal, we are comfortable with our decision to withdraw from the proceeding,' he added. 'There is simply not much left for us to do.'

The WordPerfect case is another matter. Novell will seek unspecified damages - for the specific period of its wownership, 1994-1996 - arising 'from Microsoft's efforts to eliminate competition in the office productivity applications market during the time that Novell owned the WordPerfect word-processing application and the Quattro Pro spreadsheet application'. The suit is based, in part, on the antitrust case successfully proved against Microsoft by the US Government. In that landmark case Microsoft was found to have unlawfully maintained its monopoly in PC operating systems by unlawfully eliminating competition in related markets.

'We have had extensive discussions with Microsoft to resolve our differences, but despite our best efforts, we were unable to agree on acceptable terms,' said LaSala. 'We intend to pursue our claims aggressively toward a goal of recovering fair and considerable value for the harm caused to Novell's business,' he added.

'We believe the claim doesn't have merit and is barred by the statute of limitations,' said Microsoft's general counsel Brad Smith. 'We are agreeing to disagree, and turn to the court.'

Microsoft settled with Sun Microsystems in April 2004 - Rivals Sun and Microsoft reach £2bn settlement. While that case also involved some agreements on technology collaboration and licensing and royalty payments, the Novell settlemnt is a more straightforward, one-off cash payment. Back in May 2003, Microsoft also settled with AOL and Time Warner - AOL, Microsoft settle antitrust suit.