AOL stirs up legal trouble for Microsoft

Unsatisfied with the findings of the US Supreme Court, AOL has decided to sue Microsoft for lost revenue as a result of its monopolistic and bullying behaviour towards subsidiary firm Netscape.

The lawsuit alleges Microsoft's anti-competitive behaviour has caused Netscape to lose browser licensing and portal revenue as well as revenues from its enterprise software and products.

In addition, the company wants compensation for increased marketing and distribution costs as a result of the original case.

In a statement Netscape said: "It lost goodwill and it lost the profits that would have existed if Microsoft had not acted illegally to prevent Netscape's browser technology from providing a competitive alternative to Microsoft's monopoly operating system as a development platform."

Netscape is seeking three times the amount this cost the company.

As well as seeking damages, Netscape wants "equitable relief to eliminate the continuing effects of Microsoft's illegal conduct."

However, Microsoft said it was disappointed that AOL had chosen litigation.

Microsoft and AOL have a long history of tension exacerbated by the latter's purchase of arch rival Netscape in 1999.

Relations appeared to be thawing a little last summer amid speculation of negotiations between the companies instant messaging divisions. Rumours abounded of an alliance that would allow the two technologies to interact - enabling MSN users to instant message AOL users.

However, discussions failed as both sides refused to give ground over key instant messaging and online service issues.

Microsoft said in statement: "We've consistently tried to work more closely with them in a variety of areas, including instant messaging. They have consistently turned us down."

The two companies clashed again in October over the launch of Windows XP which AOL claimed had many anti-competitive features. After intense negotiations AOL agreed not to take legal action.

However, Microsoft was unable to comment on the specifics of the case, claiming it had not reviewed the lawsuit.