Pomona Firm Suing Microsoft Over Fee

Z-Nix, a tiny Pomona supplier of personal computer “mice,” on Wednesday filed a lawsuit against giant Microsoft Corp. for restraint of trade and breach of contract. The suit, filed in U.S. District Court in Los Angeles, seeks damages of at least $4.5 million.

The suit alleges that Microsoft, after agreeing to license its popular Windows software to Z-Nix for $27.50 per copy, sought to double that fee when the Pomona company wanted to pair the software with its own product, a mouse device used to point to material on personal computer screens. Z-Nix alleges that Microsoft’s fee hike, which effectively prices the Z-Nix product out of the market, is an attempt to protect its own brand of competing PC mouse devices.

“It’s time for us to stand up to Microsoft’s unfair trade practices and stop the slow death of innovation in the industry,” said Thomas T. Chan, the Los Angeles attorney for Z-Nix.

A spokesman for Microsoft said the Redmond, Wash., company had no comment on the suit.

As Microsoft’s revenue grows to more than $1 billion a year and its product reach expands, the firm is increasingly coming under intense criticism within the PC industry for what often-envious rivals claim are unfair competitive practices. Many of the complaints stem from Microsoft’s ownership of the most popular personal computer operating system, MS-DOS, and the favorable position it affords the company when it develops personal computer software programs.

Microsoft extended its reach in the PC industry with the release earlier this year of the latest version of Windows, a software program that doubles as an operating system. Windows has proven a huge success for Microsoft, and is forcing other software publishers to scramble to develop programs that work with it.