Gates to take stand in monopoly suit

Reed Stevenson

SEATTLE: Microsoft Corp., which has made it a priority to put behind its costly legal battles, heads into court next week to face claims by Minnesota plantiffs that it abused its Windows monopoly to overcharge for software, the first such class action to go before a jury.

Bill Gates, chairman of the world's largest software maker, is expected to take the stand to argue on behalf of the company he co-founded nearly 30 years ago.

Unless a last-minute settlement is reached between Microsoft and lawyers representing seven consumers and businesses, opening arguments before a state court in Minneapolis are expected to begin by Wednesday, lawyers for both sides said.

Like other cases that were eventually settled, most notably one in California for $1.1 billion, the Minnesota class action claims that Microsoft used its monopoly in the personal computer operating systems market to overcharge customers for software.

The plaintiffs lawyers have asked for damages that could total more than $400 million.

David Tulchin, Microsoft's lead attorney in the case, said he was confident that his client would prevail in the trial.

"Our strategy is very simple -- we intend to win," Tulchin said, "We intend to show the jury that none of those people were overcharged for anything."

Rick Hagstrom, who represents the class-action plaintiffs, said he was confident that a jury would find that Microsoft used its monopoly to overcharge for software.

"There is a great deal of evidence that has never been made public before that will now be shown to a jury of Minnesotans," Hagstrom said.

Both sides declined to comment on whether they were in settlement talks.

GATES ON THE STAND

The trial, to be heard by Judge Bruce Peterson of the Hennepin County District Court, is expected to last 10 to 15 weeks into at least mid-June.

Microsoft has already settled with nine other states and the District of Columbia, but remains the target of antitrust lawsuits brought by competitors. The European Commission is expected to unveil soon its decision on its antitrust case against Microsoft.

Microsoft's prior class-action settlements, which resulted in a total payout of more than $1.5 billion, cannot be used as evidence in the Minnesota trial, since Microsoft admitted no wrongdoing.

Instead, Hagstrom said he would rely on the federal antitrust decision and demonstrate that Microsoft has long engaged in predatory practices that take advantage of its dominant market position.

In addition to Gates, Microsoft Chief Executive Steve Ballmer and other executives are named as witnesses in the trial. If Gates testifies, it would be his first court appearance since a federal antitrust case against Microsoft that concluded in 2002.

"Yes we plan on calling them," said Microsoft lawyer Tulchin. "Mr. Gates intends to be here. The story of Microsoft is one of the great success stories and Mr. Gates is the perfect person to tell the story."

Tulchin noted that the federal antitrust case only applied to operating system software and a limited time period in the 1990s, making it more difficult for the plaintiff to create an argument based on a longer time period and for applications software.

© Reuters