Microsoft, You're Be-ing Sued

Be, which once sold an OS rival to Windows and the Mac OS, is suing Microsoft in federal court, alleging that the company's illegal business practices destroyed Be's business. The suit states that Microsoft purposefully wiped out Be's market value--which at one time exceeded $1 billion--by illegally preventing PC makers from bundling the Be OS with their systems. Be is asking for triple damages and an unspecified amount of punitive damages.

"Be announced today it has filed suit against Microsoft Corporation for the destruction of Be's business resulting from the anticompetitive business practices of Microsoft," a statement from the company reads. "The lawsuit alleges, among other claims, that Microsoft harmed Be through a series of illegal exclusionary and anticompetitive acts designed to maintain its monopoly in the Intel-compatible PC operating system market and created exclusive dealing arrangements with PC OEMs prohibiting the sale of PCs with multiple preinstalled operating systems."

Former Apple executive Jean-Louis Gassee, who wished to develop a powerful multimedia-oriented computer, founded Be in 1990. Originally, Be created hardware systems that ran on the PowerPC platform, but the company later dropped its hardware design and ported its OS software to Apple's Mac systems. This arrangement lasted until Steve Jobs took over Apple and prevented Be from getting the hardware specifications for Apple's then-new G3 systems. Be then ported its OS to Intel-based PCs. However, the company was never very successful in this arena, so it began porting its OS to PC-like devices and eventually secured a contract with Sony, which used the Be OS in the short-lived eVilla device. Palm purchased Be in late 2001, almost solely for its engineering talent: Palm had no use for the Be OS, elegant and powerful though it was.

Be's suit is the second such lawsuit to strike Microsoft in recent days and follows similar legal action from AOL Time Warner's Netscape unit. In addition, Microsoft is facing other antitrust-related challenges, including hundreds of class-action lawsuits. Microsoft says it hasn't yet reviewed the suit, but a company spokesperson noted that "this sort of litigation isn't in the interests of consumers, nor is it good for the industry."