IBM Corp has suffered a serious setback in a case it thought it had won, the interminable anti-trust suit brought by computer refurbisher Allen-Myland Inc of Broomall, Pennsylvania. The Third US Circuit Court of Appeals in Philadelphia ruled that IBM had pulled the wool over the lower court’s eyes by including all computers down to programmable calculators to claim that it didn’t dominate the mainframe market, and that the court trial was wrong to rule in IBM’s favour six years ago, and effectively agree with the company that its actions weren’t anticompetitive because no separate market for the installation of mainframe upgrades existed. The case was brought in by Allen-Myland in 1985, when the company argued that IBM’s pricing policy on parts made it prohibitively expensive for any company other than IBM to upgrade a mainframe. The three-judge appeals panel also said that it was likely that the $20m market for upgrade installations had become unprofitable not because of improvements in technology as IBM contended, but as a result of IBM’s behaviour. According to the Wall Street Journal, IBM claimed that the opinion affirmed critical portions of the trial court’s decision and ultimately would support judgement in its favour. Allen-Myland’s lawyer said there was nothing in that opinion to give IBM any optimism.
