Novell Sues Microsoft, Alleges Misleading Advertising

Novell Inc., a manufacturer of networking software, has filed a federal lawsuit against Microsoft Corp. charging the software giant with “making and distributing false and misleading statements” about Novell and its products.

Provo, UT-based Novell is asking the court to force Microsoft to stop making the statements about Novell immediately, recall the advertising and issue corrective advertising.

The lawsuit, filed in U.S. District Court in Salt Lake City, said the statements and advertising by Microsoft, Redmond, WA, appear to be in response to Novell's recent introduction of its NetWare 6 network operating system software.

Novell said the statements were contained in a direct mail piece shaped like a breakfast cereal box that Microsoft distributed recently to Novell customers with the headline “Microsoft Server Crunch.” Novell said the piece included false statements relating to Novell's recent purchase of consulting firm Cambridge Technology Partners and alluding to it abandoning the NetWare platform.

No one from Microsoft was available to comment.

“Microsoft has tried to create a fictitious end of life for NetWare to create fear and uncertainty within Novell's customer base and to discourage future customers from doing business with Novell,” said Stewart Nelson, Novell's executive vice president and chief operating officer. “While corporate America has long grown used to Microsoft's bullying business tactics, with this campaign Microsoft has crossed well over the line.”

Novell alleged that Microsoft's statements “go far beyond” competitive advertising and cross over into violating state and federal laws. The company also said that the cereal box campaign was not Microsoft's first aimed at Novell. In April, the company said, Microsoft published an article on its MSN Money Central portal that “falsely stated Novell was moving out of the software business and into the network consulting business.” Microsoft modified that statement after Novell complained.

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