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Judge puts stop to more 'Vista Capable' insider e-mails

Suspends lawsuit while appeal is considered

April 6, 2008 12:00 PM ET

Computerworld - A federal judge last week granted Microsoft Corp.'s request to suspend the "Vista Capable" lawsuit while an appeals court reviews her decision to give the case class-action status.

The move blocks, for now, any new disclosure of insider e-mails by Microsoft employees, such as those made public in February, or the release of internal messages from the nearly 30 companies and people who had been subpoenaed and ordered to deliver documents.

In the year-old lawsuit, consumers have charged Microsoft with misleading PC buyers by sponsoring a marketing program meant to keep computer sales going in the months leading up to Window Vista's late-2006 release. However, the lawsuit alleged, many machines that boasted the Vista Capable sticker were able to run only Home Basic, a version the plaintiffs said was not the "real" Vista because it omitted some of the most heavily promoted elements of the new operating system.

Last Thursday, U.S. District Court Judge Marsha Pechman granted Microsoft's motion to stay the lawsuit, putting the case on hold while the Ninth Circuit Court considers Microsoft's appeal. Four weeks before, Microsoft had appealed Pechman's ruling that the case be granted class-action status, arguing that the company would rack up expenses and suffer damaged business relationships for no purpose if the case continued but later was denied class-action status by the review court.

Lawyers for the plaintiffs, who had petitioned Pechman to keep the case going -- and who wanted to continue collecting documents from Microsoft and others as part of the case's discovery process -- took the decision in stride. "We had obviously hoped to proceed to trial in October, notwithstanding Microsoft's appeal, [but] while we wanted to go forward now, given the breadth of the class trial, the court's order is certainly a reasonable position to take," said Jeffrey Tilden, an attorney at Seattle-based law firm Gordon Tilden Thomas & Cordell LLP, in an e-mail Sunday.

The case has become notable because of the 158 pages of Microsoft e-mails that the plaintiffs' attorneys had acquired during discovery. Pechman unsealed those documents and released them to the public record on Feb. 27. Among other revelations, the messages showed that top-level Microsoft 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 about which versions of the upcoming operating system their new PCs would be able to run.

One of the reasons Microsoft gave to Pechman for postponing the case while the Ninth Circuit decides was that it would "would intrude on sensitive pricing decisions and strategies by [manufacturers], wholesalers and retailers and would jeopardize Microsoft's goodwill with class members." The latter would have been made up of consumers who had purchased PCs labeled with the Vista Capable logo.



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