Case: Sun Microsystems v. Microsoft
Microsoft and Sun entered into a Technology Licencense and Distribution Agreement (TLDA) on March 1996 (Findlaw, 2008). Under the said agreement, Microsoft agreed to pay Sun $3.75 million anually in exchange for the non- exclusive license of the Java created by Sun for Microsoft (Findlaw, 2008). Compatibility requirement was included in the agreement wherein it required Microsoft to produce compatible implementation of Java within six months from the date Sun made the significant upgrade (Findlaw, 2008). In addition, Sun required that Microsoft to include mode which a Tool Customer may use to permit such product to pass the Java Language Test Suite that accompanies any upgrades of Java that Sun created.
However, in October 1997, Sun filed a suit against Microsoft for trademark infringement, unfair competition, breach of contract, among others because it found the latter distributing a polluted version of Java which is not compatible with Sun’s standards (Findlaw, 2008). Moreover, it ask the court for injunction to bar Microsoft from using the Java and from distributing its own version. The district court granted the injuctions. Microsoft appealed the decision to the Cour of Appeals.
Issue: Did the district found sufficient evidence to prove that Microsoft violated the terms of the agreement?
Decision: The Court of Appeals vacated the injunctions and it remanded the case to the district court (Findlaw, 2008).
To receive a preliminary injunction, Sun shall show an evidence to prove that they have suffered irreparable injuries from the acts. This issue was not addressed by the district court. There must also be a finding to clarify if Microsoft has acted outside the scope of license provided in the agreement or if the act was a separate contract.
The case illustrates the importance of understanding the provisions of a contract. In the case, Sun disputed that the act was a copyright infringement while Microsoft believed it to be a breach of contract. These disputes are necessarily be decided before an injuction could be granted. Nevertheless, whichever would be the findings it is clear that the Sun will win the case because Microsoft has acted beyond the agreement.
FindLaw. (2008). Sun Microsystems v. Microsoft. Retrieved May 31, 2008, from http://caselaw.lp.findlaw.com/cgi-bin/getcase.pl? court=9th;navby=docket;no=9915046
Microsoft News. (2008). Microsoft Reaches Agreement to Settle Contract Dispute With Sun Microsystems. Retrieved May 31, 2008, from http://www.microsoft.com/presspass/press/2001/jan01/01-23sunpr.mspx
Microsoft News. (2008). Settlement Agreement and Mutual Limited Release. Retrieved May 31, 2008, from http://www.microsoft.com/presspass/legal/01-23settlement.mspx