Microsoft Wins Y2K Lawsuit in Federal Court in Illinois

REDMOND, Wash., March 4, 1999 — Microsoft Corp. announced a major court victory Friday with the dismissal of a year 2000 (Y2K) lawsuit filed in federal court in Illinois. The lawsuit, filed originally as a class action by plaintiff Ruth Kaczmarek of Naperville, Ill., was dismissed with prejudice by the U.S. District Court for the Northern District of Illinois.

In a strongly worded opinion, the court said, “As we near the 21st century, the media has focused on many potential Y2K problems. This focus will inevitably lead to much litigation , which the courts will need to determine is meritful or meritless. Unfortunately for the plaintiff, we find this lawsuit falls in the latter category.”

“This is an important win for Microsoft,” said Andy Culbert, a corporate attorney at Microsoft. “This case shows that Microsoft has acted in a responsible and pro-consumer manner with respect to its products and year 2000. The courts dismissal of this case with prejudice sends a strong message that should deter groundless year 2000 litigation.”

The original case had alleged that certain versions of the Microsoft® FoxPro® database software contained a defect in the way it handles dates after Dec. 31, 1999. The plaintiff argued that because of the alleged defect, Microsoft had breached the warranties and committed negligence in the softwares design.

The FoxPro-related issue centers around a product feature called the Century function. When the Century function is set to “On,” FoxPro accepts and can correctly process dates into the next century. When it is set to “Off,” it assumes two-digit years to be within the 20th century. Microsoft disclosed this information in the product manual and on its year 2000 Web site, located at .

“This opinion really puts year 2000 issues in perspective and supports all of the work Microsoft has been doing to help customers prepare for the year 2000,” said Michel Gahard, a corporate attorney at Microsoft. “Microsoft is committed to providing the information resources, tools, channel support and services to assist our customers in preparing for the year 2000, and we will continue down that path.”

The court found that Microsoft had made it clear in the manual for FoxPro how the software handles dates and that the plaintiffs claim was without merit. “Kaczmareks main problem is that there is nothing inherently wrong with computer software that assumes that a two-digit year entry means the 20th century, particularly when the default setting is disclosed as part of the contract,” the court said. Moreover, FoxPro is Y2K-compliant: A developer can set the Century feature to “On” to provide a four-digit-year field when a client needs an application that will process dates occurring later than Dec. 31, 1999 something, we assume, is occurring with greater frequency as that date approaches.”

“In other words,” the court said, “there is no defect in the program; FoxPro operates in the manner indicated by the user manual. Thus, Kaczmarek cannot establish a breach of Microsofts warranties. Finally, absent a defect in FoxPro, Kaczmarek cannot show negligence by Microsoft. Because there is no factual or legal basis for Kaczmareks claims, the case is dismissed with prejudice.”

For year 2000 information, recommendations and updates regarding Microsoft products, please visit the Microsoft Web site at , call (888) MSFT-Y2K (673-8925) or contact your local subsidiary.

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day.

Microsoft and FoxPro are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

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