Microsoft settles one claim by Novell

  • Associated Press
  • Monday, November 8, 2004 9:00pm
  • Business

WASHINGTON – Software giant Microsoft Corp. opened its wallet again Monday to clear more of its courtroom problems, paying $536 million to rival Novell Inc. and an undisclosed smaller amount to a trade group that had backed antitrust complaints by the U.S. government and the European Union.

Novell, a bitter, decades-long rival of Microsoft, said despite the huge payoff it intends to file an antitrust lawsuit against Microsoft this week over damage a decade ago to its once-popular WordPerfect business software.

The payments announced Monday, however, were enough to persuade Novell and the Washington, D.C.-based Computer and Communications Industry Association to pull out of the legal case against Microsoft in the European Union, which has determined Microsoft abused its industry dominance and fined it $600 million. A crucial ruling on sanctions against Microsoft is expected as early as this month.

Microsoft previously spent $2.4 billion settling antitrust and other claims by AOL Time Warner Inc. and Sun Microsystems Inc., both significant supporters of the European case. But even billions in payments won’t put more than a dent in Microsoft’s staggering cash reserves of about $64.4 billion.

Novell said the $536 million agreement resolves antitrust claims involving the Netware operating system for connecting computers across networks, which competes with Microsoft’s dominant Windows software. Joseph A. LaSala Jr., Novell’s general counsel, called it a significant settlement. The company’s shareholder meeting was set for today.

Microsoft, one of the most widely held securities, predicted Monday in financial disclosure documents that it still could face up to $950 million in exposure for remaining antitrust claims, including the court cases expected or already filed by Novell and RealNetworks Inc.

Microsoft restated its first-quarter financial results to reflect Monday’s announcements, adjusting net income down to $2.53 billion and earnings per share to 23 cents. Novell’s net income for its latest quarter was $14 million.

Novell said it will allege in its upcoming antitrust lawsuit that Microsoft acted illegally during the mid-1990s when its Office business software eclipsed the popularity of Novell’s WordPerfect word-processing program. The WordPerfect lawsuit will seek unspecified damages and will be based partly on facts proved in court during the U.S. government’s antitrust case against Microsoft, LaSala said.

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

Microsoft’s general counsel, Brad Smith, said his company was ready for that court fight.

The Computer and Communications Industry Association, which has fought Microsoft vigorously on legal fronts for more than a decade, did not disclose the size of its payment. People familiar with the deal, speaking on condition of anonymity, said it was a fraction of the amount paid to Novell. The association said Microsoft will spend $65,000 to join the trade organization.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Business

2025 Emerging Leader Anthony Hawley (Olivia Vanni / The Herald)
Anthony Hawley: Creating friendships and filling pantries

Since 2021, Hawley has increased donations to Lake Stevens Community Food Bank through fundraising and building donor relationships.

2025 Emerging Leader Megan Kemmett (Olivia Vanni / The Herald)
Megan Kemmett: Seeking solutions to any problem or obstacle

Executive director of Snohomish Community Food Bank overcomes obstacles to keep people fed.

2025 Emerging Leader DeLon Lewis (Olivia Vanni / The Herald)
DeLon Lewis: Helping students succeed

Program specialist for Everett Community College believes leadership is about building bridges.

(Image from Pexels.com)
The real estate pros you need to know: Top 3 realtors in Snohomish County

Buying or selling? These experts make the process a breeze!

Relax Mind & Body Massage (Photo provided by Sharon Ingrum)
Celebrating the best businesses of the year in Snohomish County.

Which local businesses made the biggest impact this year? Let’s find out.

Construction contractors add exhaust pipes for Century’s liquid metal walls at Zap Energy on Monday, Feb. 3, 2025 in Everett, Washington. (Olivia Vanni / The Herald)
Snohomish County becomes haven for green energy

Its proximity to Boeing makes the county an ideal hub for green companies.

A closing sign hangs above the entrance of the Big Lots at Evergreen and Madison on Monday, July 22, 2024, in Everett, Washington. (Ryan Berry / The Herald)
Big Lots announces it will shutter Everett and Lynnwood stores

The Marysville store will remain open for now. The retailer reported declining sales in the first quarter of the year.

George Montemor poses for a photo in front of his office in Lynnwood, Washington on Tuesday, July 30, 2024.  (Annie Barker / The Herald)
Despite high mortgage rates, Snohomish County home market still competitive

Snohomish County homes priced from $550K to $850K are pulling in multiple offers and selling quickly.

Henry M. Jackson High School’s robotic team, Jack in the Bot, shake hands at the 2024 Indiana Robotics Invitational.(Henry M. Jackson High School)
Mill Creek robotics team — Jack in the Bot — wins big

Henry M. Jackson High School students took first place at the Indiana Robotic Invitational for the second year in a row.

The computer science and robotics and artificial intelligence department faculty includes (left to right) faculty department head Allison Obourn; Dean Carey Schroyer; Ishaani Priyadarshini; ROBAI department head Sirine Maalej and Charlene Lugli. PHOTO: Arutyun Sargsyan / Edmonds College.
Edmonds College to offer 2 new four-year degree programs

The college is accepting applications for bachelor programs in computer science as well as robotics and artificial intelligence.

Nichole Webber: Drawing up plays for athletes and politics

The communications director for the city of Everett believes leadership is rooted in honesty, integrity and selfless commitment to others.

2025 Emerging Leader Natalie Given (Olivia Vanni / The Herald)
Natalie Given: Building trust and communicating concerns

Everett Police Department’s Public Information Officer builds relationship and better communication.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.