Netscape Communications, a division of AOL Time Warner, has filed suit against Microsoft, claiming that the software giant's business practices have harmed it.

The lawsuit is based on court findings that Microsoft's business practices amid the infamous browser wars of the 1990s violated two sections of the 1890 Sherman Antitrust Act. In April 2000 a federal judge ruled that Microsoft used anti-competitive means to thwart browser Netscape. In June 2001, a panel of seven appellate judges upheld eight separate antitrust violations by Microsoft.

AOL acquired Netscape in 1999.

In some ways, the Netscape lawsuit is trying to achieve items the government failed to do so at trial, such as proving Microsoft tried to extend its Windows monopoly to the browser market.

"Netscape's lawsuit is a logical extension of the findings entered by the District Court and unanimously affirmed by the Court of Appeals that Microsoft thwarted competition, violated the antitrust laws and illegally preserved its monopoly at Netscape's expense," Randall Boe, AOL's general counsel, said in a statement.

"There is no question that Microsoft's conduct violated the law and harmed competition and consumers," Boe continued. "Netscape's lawsuit seeks not only an award of damages, but for the court to provide injunctive relief that will help restore competition on the computer desktop."

Microsoft asserted that the lawsuit is more a competitive move by AOL Time Warner than a legitimate attempt to recover damages.

"AOL Time Warner has been using the political and legal system to compete against Microsoft for years," Microsoft spokesman Jim Desler said. "This is just the next tactic in their litigation plans. Microsoft is investing to build new products, while AOL invests in lawyers and lobbyists to put roadblocks in Microsoft's way."

Desler also accused AOL Time Warner of using the Netscape lawsuit to undermine the settlement that Microsoft reached in November with the Justice Department and nine states. That settlement is undergoing review pursuant to the Tunney Act. In December, nine other states that didn't join the settlement filed a remedy proposal asking that, among other items, Microsoft be compelled to give away Internet Explorer to restore competition in the browser market.

AOL Time Warner is using the Netscape suit "as an attempt to undermine the settlement between Microsoft, the DOJ and the bi-partisan group of attorneys general," Desler said. "Today's filing is timed to interfere with the efforts to bring that case to a conclusion."

Netscape is asking for a jury trial and is seeking damages but did not specify an amount in the lawsuit, filed in US District Court for the District of Columbia. However, the lawsuit does ask for triple damages based on the Clayton Act and the District of Columbia Code, as well as interest and attorneys fees.

Netscape also asked for an injunction against Microsoft's alleged antitrust violations, both current and future.

The judge in the case ultimately would decide the nature of the injunctive relief, which Netscape suggested could be derived from a remedy proposal filed last year by nine states and the District of Columbia. One option: forcing Microsoft to release a version of Windows without its own middleware products, such as a Web browser, media player or instant messenger.

Bob Lande, a professor at the University of Baltimore Law School, sees the Netscape suit as unique in some ways.

"This is fundamentally different from the couple of hundred other private suits filed against Microsoft because it's not just arguing over money," Lande said. "Here they're asking for injunctive relief that could change the way the high-tech market looks and change the nature of competition in the market. There is really tremendous public interest in which way this thing comes out."

Rich Gray, a Silicon Valley lawyer closely watching the Microsoft antitrust trial, had a mixed response to the lawsuit.

"On the one hand, it's a dramatic development. But on the other, it's not a surprise," Gray said.

He noted that US District Judge Thomas Penfield Jackson's "findings of fact" issued in November 1999 "provide a road map directly to this lawsuit." There are also competitive reasons for filing the lawsuit now.

AOL and Microsoft "are in a death struggle for ownership of the consumer in the digital world," Gray said.

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