The first half of the Addamax Inc anti-trust suit against the Open SoftwareFoundation, Digital Equipment Corp and Hewlett- Packard Co ended last week,five years after it was first filed (CI No 1,663). The case is being heard backwards, with the amount of liability being decided by a federal judge before the responsibility for such damages is fixed by a jury. Addamax told the court it suffered damages of $51,175,000, an amount that would be trebled to $153.5m as a punitive measure if the decision goes in its favor. Attorneys’ fees, which are doubtless hefty, are also asked. Addamax supported its position with 12 days of expert testimony. The three defendants ultimately offered no defense at all, beyond their openingstatement and the holes they poked in Addamax’s case during cross-examination. The defense’s move came as a surprise. According to court records, it had anticipated calling eight or 10 witnesses of its own, but decided over the weekend of December 14-15, right before it was to begin presenting its side last Monday, to rest instead. The two sides now have until February 28 to provide the Federal court with findings of fact and conclusions of law and make any replies. The judge’s decision is expected thereafter. Unless a settlement is reached between times, something that hasn’t been forthcoming so far, although the judge has been encouraging it, the second part of the case will follow.
Industry collusion
Addamax Inc was a small B1 security software house that claims to have been driven out of business by the collusion of Hewlett, DEC and the other Open Software Foundation sponsors, the terrific market power they wielded as part of the Software Foundation combine and their anti-competitive destruction of Addamax’ marketplace. It says they destroyed its market when the Foundation – in what it claims was a rigged request for technology process – chose SecureWare Inc, a company with which Hewlett had a separate strategic alliance, and used its security technology in the OSF/1 operating system. This effectively created a de facto standard that barred Addamax from selling its wares. Addamax claims the only way it could have had its own technology selected was to knuckle under to the Foundation’s exploitative licensing terms and accept a fraction of its software’s value. The Foundation is alleged to have told Addamax it had a choice between getting a little money out of the market now and no future business, or don’t deal with OSF at all and get no business at all. The defendants claimed in their opening statement that B1 security fell by the wayside as a product of interest to customers – including even the US Defense Department, which originated the standard – and was replaced by Compartmented Mode Workstation, and, if the failure of the market to materialize isn’t enough to explain Addamax’s failure, well then, the start-up also suffered from poor management, a constant cash- flow crisis and admittedly poor marketing. They flatly deny that Addamax is entitled to any damages on their account. In many respects Addamax is standing in for Sun Microsystems Inc, which loaned Addamax $7.5m to underwrite its forbidding legal costs (CI No 2,015). Back in its heyday, the Open Software Foundation, now subsumed into the Open Group, was said to stand for Oppose Sun Forever, It’s also said if Sun had made its own case, what would be at stake here would be in the billions of dollars.
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