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Novell Files Suit After Microsoft Doesn't Recall Ads

Novell accuses Microsoft of making false claims that Novell may stop supporting NetWare.
Novell filed its false advertising lawsuit against Microsoft after Microsoft mailed software and solicitations for consulting services to about 2,000 NetWare customers, then refused to meet Novell's demands that it recall the mailers.

Novell filed suit in U.S. District Court in Salt Lake City Monday, claiming that an August Microsoft business-to-business ad campaign contained "false and misleading" claims that Novell plans to stop supporting its NetWare operating system.

A Microsoft spokesman says the company sent "a couple of thousand" mock-up cardboard cereal boxes labeled "Microsoft Server Crunch," to Novell customers. The boxes bore statements including "What's the expiration date on that NetWare platform?" and "Novell is shifting its focus from software development to consultancy services," and contained copies of Microsoft Services for NetWare, a software package for migrating Novell servers to Windows 2000.

Novell seeks an injunction against Microsoft to stop disseminating the ads, a recall of the cereal boxes, corrective advertising, and monetary damages, which a Novell spokesman says haven't yet been determined. Novell's complaint also cites an April article Microsoft posted on its Web site that said Novell "is moving out of the software business." Novell acquired consultancy Cambridge Technology Partners in July, and Cambridge CEO Jack Messman became president and CEO of Novell, replacing Eric Schmidt, who became CEO of Google Inc.

In mid-September, Novell asked Microsoft to recall the cereal-box campaign and apologize to customers, according to Novell's spokesman. Microsoft's spokesman says the company mailed recipients a letter on Sept. 27, but Novell says that action didn't go far enough.

Microsoft says it hasn't decided whether to fight Novell's suit in court or try to settle it. Says its spokesman, "We regret any inconvenience to customers."