Update: Microsoft-Novell antitrust case ends in hung jury

Novell's suit claims Microsoft harmed its desktop business through abusive practices enabled by Windows dominance

After seven years' preparation and a two-month trial, Novell's $1.3 billion antitrust lawsuit against Microsoft ended on Friday in a hung jury, according to a spokesman for Microsoft who was at the court.

"It is confirmed that the jury could not come to an accord and that no length of further deliberation would alter that," said the spokesman, who is with one of Microsoft's public relations agencies.

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Novell filed its lawsuit seven years ago, claiming Microsoft abused its dominant position in the PC OS market to harm Novell's desktop applications business.

The jury at the U.S. District Court in Salt Lake City, Utah, had been deliberating the case for almost three days after closing arguments were presented earlier this week. On Friday the 12-member panel informed the judge they were unable to reach a unanimous decision and the judge declared a mistrial.

At least one juror was in tears as the jury was dismissed, the Microsoft spokesman said.

The jury had asked for clarification on several points during deliberations, including questions about the definition of "middleware." The terminology apparently caused some confusion. At one point, the jury asked whether Windows 95 was considered "an operating system or middleware," court filings show.

"While Novell is disappointed that the Jury was unable to reach a unanimous decision, Novell still believes in the strength of its claim," the company said in a statement. "Clearly, this is a complicated technical case and Novell is hopeful that a re-trial will allow the opportunity to address any uncertainties some of the jurors had with this trial."

Novell's lawsuit accused Microsoft of misleading it about certain technical details prior to the release of Windows 95, to the detriment of Novell's WordPerfect, Quattro Pro and other applications. Microsoft's behavior ran afoul of U.S. antitrust laws, according to Novell, which was seeking approximately $1.3 billion in damages.

Prior to the launch of Windows 95, Microsoft invited Novell to work on versions of its applications for the new Microsoft operating system. But Novell ran into a variety of problems that it claimed were caused by Microsoft.

Microsoft had removed a key set of internal APIs (Application Programming Interfaces) that Novell's software needed to function properly. Novell also found a number of bugs in Windows 95 that caused problems for its software, and which Microsoft was allegedly slow to address. Novell also accused Microsoft of hiding certain system calls that could only be used by other Microsoft applications, such as Microsoft Office, speeding their performance.

Last month, former Microsoft CEO Bill Gates took the stand and denied his company had acted in a way to deliberately harm Novell. The changes to Windows 95 were required to make the OS stable, he told the jury. Novell could have produced more compatible versions of its software but acted too slowly, Gates said.

The case was originally filed in the U.S. District Court in Salt Lake City, but was moved to Maryland to combine pretrial proceedings with other lawsuits filed against Microsoft. Novell had filed six claims against Microsoft, five of which were dismissed, with the U.S. Court of Appeals in May reversing the dismissal of the sixth claim and moving the case back to the District Court in Utah.

Although Microsoft does not cast as deep a monopolistic shadow across the IT landscape as it once did, the case is significant for a number of reasons, Charles King, head of the Pund-IT analysis firm, said earlier in the week.

"Many would claim that the Novell case is old news. I'd take the opposite side of that argument -- anti-competitive behavior and how it is punished or condoned is as critically important today as it has ever been," King said.

Novell was acquired earlier this year by The Attachmate Group and is now a subsidiary of that company.

Joab Jackson covers enterprise software and general technology breaking news for The IDG News Service. Follow Joab on Twitter at @Joab_Jackson. Joab's e-mail address is Joab_Jackson@idg.com

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