Microsoft litigation
In its 2008 annual report, Microsoft stated:[1] Government regulatory actions and court decisions may hinder our ability to provide the benefits of our software to consumers and businesses, thereby reducing the attractiveness of our products and the revenues that come from them.
New actions could be initiated at any time, either by these or other governments or private claimants, including with respect to new versions of Windows or other Microsoft products.
Critics attest that it also used predatory tactics to price its competitors out of the market and that Microsoft erected technical barriers to make it appear that competing products did not work on its operating system.
In a series of rulings by judge Thomas Penfield Jackson, the company was found to have violated its earlier consent decree and abused its monopoly in the desktop operating systems market.
The new administration announced that in the interest of ending the case as quickly as possible, it would no longer seek to break the company up, and that it would stop investigating claims of illegal tying of products.
However, the European Commission has characterized the much delayed protocol licensing as unreasonable, called Microsoft "non-compliant" and still violating antitrust law in 2007, and said that its RAND terms were above market prices; in addition, they said software patents covering the code "lack significant innovation", which Microsoft and the EC had agreed would determine licensing fees.
[24] Microsoft accepted the judgment of the Court of First Instance and proceeded to make available interoperability information as originally required by the European Commission.
[citation needed] Microsoft also faced sanctions from Japan Fair Trade Commission twice in 1998 when Japanese manufacturers were forced to include Microsoft Word on new systems instead of homegrown word processor software Ichitaro,[27] and again in 2004 for clauses detrimental to ability of Japanese computer manufacturers to obtain a Windows OEM license.
European antitrust regulators on February 27, 2008, fined Microsoft $1.3 billion for failing to comply with a 2004 judgment, that the company had abused its market dominance.
Microsoft had previously been fined after the commission determined in 2004 that the company had abused the dominance of its Windows operating system to gain unfair market advantage.
[29] In July 2023, the European Commission formally opened an investigation into the alleged antitrust violation,[30] and in June 2024 the European Commission announced its preliminary view that Microsoft had violated antitrust law, finding that "Microsoft may have granted Teams a distribution advantage by not giving customers the choice whether or not to acquire access to Teams" when purchasing its other software suites, and that "This advantage may have been further exacerbated by interoperability limitations between Teams' competitors and Microsoft's offerings.
"[31] If the European Commission confirms its preliminary view, Microsoft potentially faces a fine of up to 10% of its annual worldwide revenue.
On February 27, 2008, the European Union (EU) competitions commission announced its decision to fine the Microsoft Corporation €899 million (US$1.35 billion), approximately 1/10 of the company's net yearly earnings, for failing to comply with the 2004 antitrust order.
European Commissioner for Competition Neelie Kroes stated that the fine was "reasonable and proportionate," as the figure could have gone up as high as €1.5 billion, the maximum that the EU commission can impose.
Although she also expressed hope that "today's decision closes a dark chapter in Microsoft's record of non-compliance with the Commission."
"[citation needed] Microsoft's General Counsel Brad Smith commented "It's clearly very important to us as a company that we comply with our obligations under European law.
The decisions came after Microsoft announced they were disclosing 30,000 pages of previously secret software code last Thursday (February 21).
Bundling them together is alleged to have been responsible for Microsoft's victory in the browser wars as every Windows user had a copy of Internet Explorer.
It was further alleged that this unfairly restricted the market for competing web browsers (such as Netscape Navigator or Opera) that were slow to download over a modem or had to be purchased at a store.
On June 30, 2004, the U.S. appeals court unanimously approved the settlement with the Justice Department, rejecting objections that the sanctions were inadequate.
The acquisition proposal itself has reignited antitrust concerns targeted at Microsoft, with mixed reactions from international regulators and rival companies.
[35] The Court of Justice of the European Union on 16 July 2020 had ruled that "it is illegal to send private data from the EU to the US"[36][37] Microsoft Office 365 had been banned from several schools in Europe over privacy concerns.
[41][42] In March 2004, during a consumer class-action lawsuit in Minnesota, internal documents subpoenaed from Microsoft revealed that the company had violated nondisclosure agreements seven years earlier in obtaining business plans from Go Corporation, using them to develop and announce a competing product named PenWindows, and convincing Intel to reduce its investment in Go.
In 2006, Microsoft initiated an investigation of Lithuanian government institutions for determining whether they choose long-term strategies of the software they use correctly.
The investigation, funded by Microsoft itself, will be performed by the Vilnius University together with the Lithuanian Institution of the Free Market, a think tank organization.
Lucent claimed in this first San Diego case that Dell and Gateway had violated patents on MP3-related technologies developed by Bell Labs, a division of predecessor company American Telephone & Telegraph.
In addition to the United States, Microsoft has also sued Lindows in Sweden, France, Belgium, Luxembourg, the Netherlands and Canada.
Microsoft prevailed in court and also established a precedent that liabilities under the Anticybersquatting Consumer Protection Act (ACPA) include contributory trademark infringement.
[122][123][124] In June 2023, a lawsuit claimed that Microsoft's partner and supplier OpenAI scraped 300 billion words online without consent and without registering as a data broker.
They also claimed that Microsoft and OpenAI continued to unlawfully collect and use personal data from millions of consumers worldwide to train their artificial intelligence models.
