Case Comp/C-3/37.792 Microsoft
Commission of the European Communities
2007 O.J. (L 32) 23 (2004)

- Written by Kelli Lanski, JD
Facts
In 1998, Microsoft Corporation (Microsoft) (defendant), the dominant firm in the personal computer (PC) operating-systems market, was preparing to release a new server operating system for Windows 2000. Servers are multiuse computers that link with PCs to form networks. Sun Microsystems (Sun), a competitor and server manufacturer, asked Microsoft for information that would allow Sun to create interoperability (i.e., compatibility) between its existing server operating system and Microsoft’s new operating system. Microsoft had previously licensed compatibility information to competitors, and Sun’s current servers were therefore interoperable with Microsoft’s. This meant that customers could and did use Microsoft PCs with servers made by Sun and others. However, Microsoft denied Sun’s request, meaning that servers manufactured by Sun and other competitors would no longer work with Microsoft’s new systems, rendering those products obsolete as to Windows 2000 users. Microsoft’s marketing tactics relating to its new server made clear to customers that other companies’ products were not compatible. Customers began migrating away from Microsoft’s competitors in favor of Microsoft’s new server, even though some competitors’ products were rated higher than Microsoft’s. As a result, Microsoft quickly grew its share of the server market, gaining dominance. Sun asked the Commission of the European Communities (the commission) (plaintiff) to commence proceedings against Microsoft for violating Article 82 of the European Commission Treaty, which prohibited an abuse of a dominant market position. In response, Microsoft argued that it had no incentive to leverage its dominance in the PC market to foreclose competition in the server market and that its intellectual property should be protected from disclosure. After an investigation, the commission issued a decision.
Rule of Law
Issue
Holding and Reasoning ()
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