RealTime IT News

Lindows Takes a Hit in Battle Against Microsoft

A San Francisco Court has ruled that a Linux company has to stop its scheme to provide instant Microsoft rebates as part of its $1.1 billion settlement with California.

San Diego, Calif.-based Lindows set up a special site, MSfreePC.com, that let them automatically qualify and apply for rebates offered to settle state consumers'four-year-old class action suit on July 19, 2003. Consumers could use an "Instant Settlement Wizard," and if they qualified, immediately use the pending rebate to instantly purchase a Windows-compatible Office suite, LindowsCD, Lindows OS 4.0 or a library of Linux software. Lindows contributed 10 percent of each rebate to open source projects such as Mozilla and OpenOffice.

Then San Francisco Superior Court Judge Paul Alvarado's ruled on December 22 that claims against Microsoft collected by Lindows.com are not valid.

"It's a shame that we're still negotiating antitrust settlements or other consumer claim settlements and not insisting on online transactions," said Lindows CEO Michael Robertson. "It's absurd."

Redmond, Wash.-based Microsoft and the administrator of the settlement both said that under the terms of the settlement, electronic submission of claim forms was not allowed, and that forms submitted through MsfreePC.com would not be valid because they weren't signed.

"Microsoft saying digital signatures aren't valid is an absurd position for a company that uses them every time you install their software," Robertson said.

The judge agreed with Microsoft. There is an official Web site with consumer information and forms, but users must print out the forms and file them through the mail. Claim forms are due by March 14, 2004.

Robertson said his company had provided software under Instant Settlement to between 100,000 and 200,000 people, and is out about $1 million.

"Which is a lot of money for a little company like ours," he said. "It's disappointing from an economic standpoint, but as a citizen of the U.S., and a person who's paid a lot of money for software over the years, it's more disappointing that we're not more progressive in applying technology to these remedies."

"The Lindows guys like to do things that get them publicity, and especially, they like to do things that get in Microsoft's face and get them publicity," said open source consultant Bruce Perens. "We wish Michael well in fighting Microsoft, but when they lose, it doesn't make that much difference to the rest of the Linux community." He said most open source developers focus on trying to do their jobs well and not worrying about how well Microsoft does its. "The customer will decide," he said.

The court decision isn't the first nor the last wrangle between Lindows and Microsoft. In December 2001, Microsoft sued the fledgling Lindows, founded two months earlier, for trademark infringement, trademark dilution, unfair competition, and unfair business practice. Lindows chose its moniker "to immediately convey to consumers an association with WINDOWS and unfairly trade off the reputation and goodwill of the WINDOWS mark," the suit said. That case is scheduled for trial in U.S. District Court in Seattle on March 1, 2004.

On Thursday, Lindows stuck another thorn into Microsoft's side, announcing the shipment of more than 300,000 laptops bundled with LindowsOS Laptop Edition. Robertson said it was "a huge deal for us." The sub-$700 laptops built by Taiwanese manufacturer ELITEGROUP Computer Systems Co. Ltd. come with built-in Wi-Fi >, an AMD 4, 1400+ processor, 128 MB of on-board memory and a 2.5" hard drive. ECS sells to major retailers in the United States, Canada, and Mexico.