Microsoft retracts statements about Novell

BANGALORE: Microsoft Corporation has agreed to withdraw the statements about
Novell that forced the latter to file a false advertising lawsuit against Microsoft
on October 1. Microsoft has agreed to send a retraction letter along with corrections
in the original Microsoft "Server Crunch" marketing piece that were sent
to Novell customers, an official press release stated on Tuesday.

The Netservices software company accused Microsoft of "disseminating
false and misleading statements about Novell through the marketing piece".
It will continue to pursue the lawsuit to recover damages, the press release added.

In response to Novell's move for a temporary restraining order to stop
Microsoft from making false statements about the company, the latter entered
into a stipulation on the record before the US District Court in Utah agreeing
to "retract the statements in question in any form or media".
Microsoft also agreed to send a correction letter to the recipients of the
original Microsoft marketing piece.

In its corrected letter, Microsoft stated, "Contrary to the statements
made about Novell on the package by Microsoft, Novell has advised Microsoft that
it is growing and expanding its software business, while adding significant
resources to its existing consulting services business. Accordingly, Microsoft
retracts its statements that Novell will not fully support NetWare, that NetWare
has an 'expiration date' or that it is or will become 'obsolete,' and that
NetWare will become costly and time-consuming to maintain."

"We are pleased with today's developments because Microsoft told the
court that it will no longer disseminate the statements that Novell contends as
false advertising, whether on the original marketing piece or by any other
means," said Joe LaSala, Novell senior vice president and general counsel.

"We are also satisfied with Microsoft's agreement to send out a
retraction letter to our customers. We believe this is recognition by Microsoft
that its initial 'corrective action' was insufficient. While the revised
retraction is a good beginning, it does not adequately redress the harm caused
to us. We are anxious to move to the next phase of the litigation where
discovery will begin and we will put together our case for damages," he
said.

According to Microsoft, it sent the marketing mailer to some 3,000 Novell
customers in August. The piece, a box headlined "Microsoft Server
Crunch," contained false statements about the future of Novell's NetWare
product, its commitment to NetWare and its acquisition of Cambridge Technology
Partners etc.