Judge Won't Dismiss Antitrust Charges Against Microsoft For Breaking 3rd Party Xbox Memory Cards
from the ruh-roh-microsoft dept
You may remember back in October of last year that Microsoft publicly warned Xbox users who were using 3rd party memory cards for their Xbox that it was about to break those cards, and that users should, instead, transfer data to Microsoft's own cards. Datel, a maker of third party cards apparently sued Microsoft, claiming antitrust violations in this move, and Eric Goldman points us to the news that a magistrate judge has rejected Microsoft's request to dismiss most parts of the lawsuit. Microsoft argued that there was no antitrust violation because Xbox buyers bought the box knowing they could only buy aftermarket parts from Microsoft. Datel responded by pointing out that the warranty that made that point was only presented to the buyer after they opened the box and "therefore, a consumer could not have knowingly and voluntarily accepted it prior to purchase." After looking at a few other factors, the judge refused to dismiss the claim, noting that "shopping for competing products in the Aftermarket is not clearly precluded by any contractual provision into which customers knowingly and voluntarily entered." Datel did lose on a separate complaint, though it can amend and refile. Either way, this is good news for the aftermarket business, and it seems likely that there will be a full trial that looks at this issue.
Oh, and we should note that Microsoft just recently decided to target the very same Datel in a patent infringement lawsuit. Gee, I wonder why they picked Datel... Must be part of Microsoft's belief in showing how "important [a] role IP plays in ensuring a healthy and vibrant IT ecosystem." That, or the belief in punishing companies who sue you for antitrust with more legal fees.