Microsoft Warns of Effect of Possible Suit

Microsoft Corp. said reports that a dozen states will seek to block release of Windows 98, if true, could mean disruption and losses for thousands of companies. PC Week Online and Cable News Network, citing unnamed sources, reported that states are preparing antitrust lawsuits to temporarily block Microsoft’s latest personal computer operating system, possibly before its scheduled May 15 shipment to PC makers. CNN said the states plan to file a joint lawsuit by Thursday. Both news outlets said the states would seek to block the system until they could hold hearings on Microsoft’s business practices. The states are working with the Justice Department, which so far has taken the lead on pursuing the Redmond, Wash.-based software giant. Federal antitrust enforcers already have won a preliminary injunction preventing Microsoft from forcing computer makers to feature its Internet Explorer browser as a condition of licensing Windows 95. Microsoft shares fell $2.38 to close at $92.13 on the Nasdaq.