Antitrust Law Daily Wrap Up, ANTITRUST NEWS: High Court asked to consider monopoly claims against Microsoft, (Jul 17, 2014)

By Jeffrey May, J.D.

MiniFrame, Ltd.—a developer of PC-sharing software—has asked the U.S. Supreme Court to consider the company’s monopoly claims against Microsoft Corporation. In a recently filed petition for certiorari, MiniFrame is seeking review of a decision of the U.S. Court of Appeals in New York City, affirming the dismissal of its Sherman Act, Section 2 claims against the PC maker.

MiniFrame brought the action against Microsoft for allegedly interfering with MiniFrame’s efforts to market the SoftXpand PC-sharing computer program. The program enables more than one user to use a single PC at the same time, instead of having to take turns or having to use multiple PCs. MiniFrame contended that Microsoft changed the terms by which it licensed its Windows operating system to customers to prohibit Windows from being used by more than one user at a time in response to MiniFrame’s new technology.

The suit was dismissed by the district court, and dismissal was upheld by the Second Circuit. According to MiniFrame, the appellate court's decision permits Microsoft “to exploit its undeniable monopoly power in the market for operating systems used in personal computers (PCs) – that is, its Windows software programs – to completely exclude MiniFrame from offering a product in a separate market: a ‘PCsharing’ software market.“

In its petition, MiniFrame asks specifically whether a cognizable claim can be stated for violation of Section 2 of the Sherman Act under the U.S. Supreme Court’s decision in United States v. Grinnell Corp., 384 U.S. 563 (1966), where a monopolist used its market power in one market to prohibit consumers from purchasing a rival’s product in a related market without a “superior product [in the related market], business acumen or historic accident” simply by incorporating that prohibition as a new license restriction for its dominant software product in the market it monopolizes.

“This case illustrates how are the pendulum has swung against antitrust plaintiffs attempting to plead a Section 2 claim,” the petition contends.

Attorneys: Robert W. Morris (Kramer Levin Naftalis & Frankel LLP) for MiniFrame Ltd.

Companies: MiniFrame Ltd.; Microsoft Corp.

News: Antitrust