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Microsoft challenges 'Vista Capable' class action

Wants to put the kibosh on document disclosure, reputation besmirchment

March 8, 2008 12:00 PM ET

Computerworld - Microsoft Corp. on Friday asked that a lawsuit claiming that it duped consumers in a Windows Vista marketing program be suspended while the company appeals a judge's decision to grant the case class-action status.

If granted, the motion would also postpone any new disclosures of potentially embarrassing company e-mails. Last month, the release of similar documents showed that top-level company executives struggled with the new operating system on machines labeled "Vista Capable," and that partners such as Dell Inc. warned Microsoft that the campaign would confuse consumers.

Friday, Microsoft petitioned the Ninth Circuit Court of Appeals to hear its challenge of the case's class-action status, which was granted two weeks ago by U.S. District Court Judge Marsha Pechman. The company also filed a separate motion with Pechman on Thursday, asking her to stay the lawsuit's proceedings pending the appeal.

"Continued proceedings here would cost Microsoft a substantial sum of money for discovery and divert key personnel from full-time tasks," said Charles Wright, an attorney for Microsoft, in the motion to suspend the case. "[It] would intrude on sensitive pricing decisions and strategies by OEMs, wholesalers and retailers; and would jeopardize Microsoft's goodwill with class members -- all with respect to claims that might not proceed on a class basis at all."

The papers filed with Pechman claimed that Microsoft had already produced nearly 50,000 pages of internal documents as part of the lawsuit's discovery process. Continuing the case pending appeal would likely mean disclosing even more documents. If the class-action status is denied on appeal, the money spent digging up messages and memos would have been wasted, and any negative publicity would generated needlessly, Microsoft argued.

The company painted a picture of business secrets made public and damage done to its reputation. "Plaintiffs' discovery almost surely will involve intrusion into the most sensitive pricing decisions of the OEMs, wholesalers and retailers who sell the PCs at issue and set their prices," said the motion. "Continued discovery thus will disrupt Microsoft's relationships with its business partners, a disruption that will be unnecessary if the Ninth Circuit reverses."

Wright also contended that because the plaintiffs will have to do a national search for consumers who can join the class action, Microsoft might get a black eye for no reason. "The result will be nationwide publicity that impugns the [Windows Vista Capable] program," read the filing. "Although Microsoft fully expects to vindicate the program in the course of this litigation, allowing notice to proceed in the face of the pending appeal will jeopardize Microsoft's goodwill based on an order that, Microsoft respectfully contends, might be held erroneous from its inception."



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