MS Korea chief
James Woo Kim |
No Damages to Be Paid; Appeals by Korean Firm Likely to Follow
By Park Si-soo
Staff Reporter
A Korean court ruled Monday that Microsoft Corp.'s bundling practice was disruptive to the market, but stopped short of ordering it to pay damages.
The ruling can be seen as Microsoft's latest victory in warding off lawsuits seeking damages and aimed at breaking up the software giant's monopoly on the market. But the losing parties have vowed to appeal the decision, meaning the Redmond, Calif.-based multinational's legal troubles have not ended just yet.
The Seoul Central District Court found Microsoft guilty of breaching the nation's anti-trust law by bundling its Windows Media Player with its operating system.
But the court rejected a domestic company's demand for 100 billion won ($81 million) in compensation for financial damages it has allegedly sustained as a result of the practice, citing a lack of evidence.
This is the second ruling of this kind, following the first verdict in June that found the multinational software company guilty of the same charge, but held Microsoft not liable for compensation.
The Korean developer, DideoNet, said it is seriously considering appealing the verdict.
"We are seriously considering appealing the ruling," a spokesman told The Korea Times following the verdict, refusing to be identified. "We cannot accept the ruling."
The spokesman said research conducted by an economist at Seoul National University confirmed the illegal practice has inflicted more than 200 billion won in sales losses on the company. "We sought half of the presumed losses that can be proved with objective evidence. But the court rejected it, citing it's groundlessness," the DideoNet spokesman said.
In the Monday ruling, presiding Judge Hwang Jeok-hwa said, "Microsoft's bundling practice violated fair competition rules, abusing its market dominance. The practice resulted in undermining consumers' freedom of choice and sound and fair competition in the market."
But the Hwang rejected the plaintiff's call for compensation, saying, "There is no reliable evidence the alleged losses were directly caused by the illegal practice."
Microsoft Korea, led by James Woo Kim, hailed the ruling.
"Microsoft is pleased with the decision," the company said in a statement. "The decision reflects the vibrant competition and innovation in the digital media space."
In a separate ruling in June, the court handed down a verdict in favor of the U.S. firm, making it unnecessary for Microsoft to compensate two Korean software companies that sought 30 billion won ($24 million) and 10 billion won in compensation, respectively.
In 2006, South Korea's financial watchdog fined Microsoft 33 billion won, ordering the company to separate its MSN Messenger and Windows Media Player programs from its Windows operating system. According to a Microsoft Korea spokesman, it paid the fine in 2007.
Microsoft's bundling practices also have triggered a dispute in fair trade in European countries as well. In 2007, a European Union court ruled that bundling Internet Explorer and Windows Media Player with the Windows operating system violated anti-trust regulations.
pss@koreatimes.co.kr
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