Novell
Wants Another Bite At The Microsoft Wallet
Having
satisfactorily concluded its lawsuit against Microsoft about its
NetWare operating system for $536 million, Novell has proceeded to
sue its archrival again, this time over damages to the market share
for WordPerfect.
In
case you’ve forgotten (it’s ancient history), WordPerfect was
the Number One PC word processing product during much of the
eighties. Microsoft sought to displace it with its Word product, but
was unable to do so until it first brought out Windows 3.0 in May,
1990, then the Windows 3.0 version of Word (same time), and then the
first Office Suite, which included Word, Excel, and PowerPoint (c.
1992). WordPerfect took a detour to the Windows market, attempting
an OS/2 product first (it didn’t ship until much later) and by the
time it brought its Windows product to market, it was no longer
Number One.
Some
years later WordPerfect sold itself to Novell (1994), for a price of
$1.4 billion. Novell
also acquired QuattroPro from Borland, to complete the WordPerfect
Office Suite, for $145 million. In 1996, Novell sold the WordPerfect
Office Suite to Corel (a Canadian PC software company) for $10.75
million in cash and 9.95 million shares of Corel stock.
It was widely rumored at the time that Novell selected Corel
over other (higher) bidders because they needed to find a
functioning software company with an active support component.
Surprisingly, WordPerfect has survived, with more than 20
million users today.
Novell, however, had tried, as part of the
NetWare suit, to get Microsoft to pay it damages for market share
damages suffered by WordPerfect.
No one outside of the parties knows just what Novell wanted,
but in conversations with Microsoft, we were led to believe Novell
had substantial sums in mind. Microsoft
couldn’t understand how Novell might be owed anything given that
most of WordPerfect's precipitous market share dive occurred before
Novell bought the company.
(Editorial
comment: We’d note
that Novell was largely an absentee landlord to WordPerfect’s
Office Suite. They were
largely interested in WordPerfect’s Groupware (messaging and
collaboration software) which they were hoping (correctly) could be
an application for the NetWare environment.
Novell kept Groupware when they sold the WordPerfect Office
Suite to Corel.)
Microsoft
commented that the four-year statute of limitations for an antitrust
suit has long run out, given that Novell sold WordPerfect in 1996.
In filing recently for dismissal of the Novell suit,
Microsoft further noted that Novell is relying upon the DOJ findings
of Microsoft’s monopoly in operating systems which was not found
to exist until long after Novell sold WordPerfect and is, therefore,
not applicable.
We’d
note further that while the Novell filing is full of discussions of
the Word Processing and Spreadsheet markets, the 94-96 market (the
time during which they owned WordPerfect) was not a market of
individual products, but rather a period during which the focus
turned to Office Suites. Keeping
that in mind, much of what Novell says in is filing simply doesn’t
add up.
Novell’s
management refused to comment to our request for an interview.
We guess we’ll have to wait to see the outcome of
Microsoft’s Request for Dismissal and further court actions,
should they occur.
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