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Microsoft Saga Continues

For the record
Zafar Aziz Osmani
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There is a lot more going on behind the scene

From: Diana J. Choyce
Mar 06 - 12, 2000

The Microsoft name pops up daily on a worldwide basis, whether it be news items, software reviews and much more. Lately the US news media has been having a hayday in Microsoft's fight with the Department of Justice. But there is a lot more going on behind the scene, especially having to do with lawsuits. Some say that the number of suits has escalated since they were first brought under fire in the well publicized anti-trust suit. But whatever the reasons, Microsoft's lawyers may end up with a more profitable year than Bill Gates himself.

This week will likely bring double the news spread as Microsoft and the Department of Justice lawyers make their final arguments in the infamous anti-trust suit. For the record, in November, U.S. District Court Judge Thomas Penfield Jackson issued his finding of facts, ruling that Microsoft was a monopoly that had abused its influence in the technology industry. Now, in the second phase of the trial, Jackson must apply antitrust law to those facts to determine whether any of Microsoft's actions were illegal. If he reaches that conclusion, the case will then proceed to a third and final phase, during which Jackson will hear more arguments from each side and then decide what penalties or remedies to impose. This weeks arguments will not likely bring any new information to light, so it is assumed that Judge Jackson will make his findings known in six to eight weeks. After that the last phase of the trial will begin. In the meantime, U.S. Appeals Court Judge Richard Posner was appointed as a mediator in November, and is continuing work with the two sides with meetings in Chicago. Given that Microsoft is even now aggressively lobbying Congress for support, it is not likely that there will be a settlement. Whatever the outcome, this is sure to be a landmark case with far reaching implications on the computer industry.

Meanwhile, Microsoft is fending off and creating new lawsuits by the dozens. We'll only look at two recent cases, as writing about all would take a full magazine and then some. Last week, a South Korean stationery company threatened Saturday to block Microsoft from using its Windows operating system label in its software manuals in South Korea. Yangji Co. says it registered and began using the trademark 'Window' on some of its diaries in 1980, before Microsoft introduced its computer software. Yangji won a seven-year legal battle against Microsoft on Friday when South Korea's patent court rejected Microsoft's attempt to repeal Yangji's Window trademark in South Korea. "It was a typical case of a giant company trying to wield its money power to do whatever it wants to do at the sacrifice of smaller companies,'' said Yangji president Kim Yong-se on Saturday. With his trademark rights re-affirmed, Kim said he was considering filing a damages suit, accusing Microsoft of illegally using Yangji's Window label on its software manuals published in South Korea. Yangji has both 'Window' and its phonetic Korean script patented as trademark names for use in printed material in South Korea. The phonetic Korean names of Yangji's Window and Microsoft's Windows are the same. The legal battle started in 1993 when Microsoft challenged Yangji's label. Kim said Microsoft once offered to pay $1,000 to buy the trademark in 1996. South Korean patent authorities and lower courts had ruled in favor of Microsoft, but Yangji appealed to the Supreme Court, which ordered a retrial in May last year. On Friday, the Patent Court reversed its earlier decision and ruled in favor of Yangji. Officials at Microsoft's Seoul office were not immediately available for comment Saturday. With $36 million in annual sales, Yangji is South Korea's largest producer of diaries.

Microsoft has even had its share of internal suits filed by its own workers. It has recently had to make a major policy change , following pressure from litigation and union organizers to bar use of so-called "permatemps'', temporary workers who stay in the same job for years, but without the benefits offered permanent workers. It is limiting its temporary workers to one year of employment at a time, with 100-day intervals in between. This move will force up to 1,500 of its long-term contract workers to find new jobs or seek permanent positions with the company. The company's permatemp practice was challenged in two lawsuits filed by long-term temporary workers who want permanent-worker benefits. Microsoft lost one case, which won temp workers the right to buy Microsoft stock at a 15 percent discount. The second lawsuit, seeking medical and retirement benefits, is still pending. Microsoft "is slowly but painfully finding out that they have to treat people who work full time, year round, as regular employees,'' said Mike Blain, a former contract worker at Microsoft and co-founder of the Washington Association of Technical Workers, a local labor group. Sharon Decker, Microsoft's director of contingent staffing, said the company made the change because of the lawsuits and negative publicity surrounding the permatemp issue. Microsoft has been aggressively hiring temp workers into full-time positions for the past couple of years, she said, and about 35 percent of new hires have worked there as temps. The company's new temp-limits policy reflects those at such companies as IBM and Intel, said Rob Enderle, an analyst at information-technology advisory firm Giga Information Group. "They are bringing the corporate policy in line with the law,'' Enderle said. "You should never have a temporary person working for more than one year.''

Microsoft will surely remain the target for news media for some time to come. And in some ways, the result is free promotion of its brand name. However one would think a company would prefer a more positive way to get its name in the news. Either way, Microsoft is still making money, its lawyers are making money, and Bill gates is making money. And we are still spending it, on Microsoft products. Life is indeed strange.