C I Host Slapped With Microsoft Lawsuit

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WHMCS Developer
I thought this was interesting:

http://www.dfw.com/mld/dfw/7251493.htm


CI Host facing license lawsuit
By Andrea Ahles
Star-Telegram Staff Writer

FORT WORTH - Microsoft is suing CI Host, alledging that the Bedford-based company is not paying licensing fees for the use of Microsoft products.

This is the second lawsuit in less than four months that places CI Host in court against a technology giant. In August, CI Host sued the leading Internet service provider, America Online, for blocking CI Host clients from communicating with AOL subscribers.

In a suit filed last week in federal court in Fort Worth, Microsoft alleged that CI Host illegally used Microsoft's Windows Server software to provide services to CI Host customers. The suit says CI Host should have paid the Redmond, Wash., company a portion of its profits from those services.

As a Web-hosting company, CI Host provides hardware and software for customers who want to have Internet sites and e-mail service without owning or maintaining the necessary software and Internet servers.

CI Host Chief Executive Chris Faulkner said in a statement that he believes Microsoft wants to obtain information about the company's clients.

"It is our belief that Microsoft has recognized we are one of their top competitors in the hosting industry," Faulkner said. "We think information on our 200,000 clients would be information valuable to any such competitor."

Microsoft said it had alerted CI Host of the software misuse in September 2001 and begun negotiating with the company to create a licensing agreement.

"After a number of attempts at trying to get them to sign a licensing agreement, we felt we had no choice but to file suit," said Mary Jo Schrade, an attorney for Microsoft.

Microsoft has licensing agreements with other Web-hosting companies; those companies pay Microsoft a fee based on the number of clients using Microsoft's software.

Although Microsoft is seeking monetary damages from CI Host, the lawsuit does not specify a dollar amount.

On Monday, Microsoft filed motions with the federal court saying it was having difficulty delivering its lawsuit to CI Host. The company cited nine failed attempts to serve the court summons to CI Host's lawyer, Carole Faulkner.

The court ruled that Microsoft could give any employee of CI Host the notice of the lawsuit. Schrade said she believes that CI Host was served Wednesday and that the company now has 20 days to respond.

Faulkner said the company has not been served. CI Host's "registered agent ... has been out of the state since Nov. 6 and is not expected to return for another week," Faulkner said.

CI Host's legal battle with America Online was transferred to federal court in September, but most of the legal proceedings were put on hold when CI Host's attorney, James Hill, died that month. A new lawyer, Scott Robelen, was named to the case two weeks ago, according to court filings.

CI Host is seeking damages of at least $10 million from AOL, citing damage to the company's reputation.
 
Wow they havent been getting the best reputation recently.
Cant believe such a big company didnt do something as small as that..
Im sure there will be more to come in the CI Host series.
Thanks for posting that Jose :)
 
Microsoft is a pain in the ass..... think about it. Out of all the people in the world that pirate Microsoft products they go after a large company... so not only can get their money for the licensing but Im sure millions for "Business damanages". If I were in CI hosts shoes I would try settle this one out of court.... then maybe start giving their techs some lessons on Linux... the free OS :)
 
I think its better that they go after a large company that can afford to pay for it instead of a small company that will go down because of it.

Of course their techs shouldbe getting training on Linux though instead of MS ;)
 
John Diver said:
I think its better that they go after a large company that can afford to pay for it instead of a small company that will go down because of it.

I would dissagree on this one. Just because CI is a large company, it doesnt make it right for Microsoft to march in there and walk out with millions of dollars that they dont deserve.

Say for example Microsoft came after me for this, they would just want me to pay for the licensing, take their money and go, since I dont have a lot of money. But when they see the opportunity (Microsoft that is) to take on a large business.... they will sue them for license fees and for 'damages'.

If MS is going to sue people, they need to start suing everyone. Not just the big dawgs... It just makes microsoft look bad because they dont have a monopoly on the hosting business yet.
 
I disagree though, there will be more damage done by a bigger company hosting loads of people than a smaller company hosting fewer people. And the more damage done, the more they should pay.

I mean, it's not exactly Microsofts fault, they should of paid the proper licensing fees.
 
they would just want me to pay for the licensing, take their money and go, since I dont have a lot of money.

MS doesnt work like that for most people, even very small businesses.
They arent going to just ask for the license fee and leave it, even if you have been using their products already without having a license.
MS dont care how much money you have, they will try take as much from you as they can depending on how much they have lost because of you using their products without a license and depending on the time length you have been doing it.

I dont think MS should charge so much for their products when there are free programs out there which can be just as good but I dont think CI Host can complain about MS taking action against them, they knew what they had to pay and didnt do it.

I have a different point of view because of them sueing AOL over something so stupid, they are out to get as much money as they can and I dont think they have the right to complain when MS as doing something they have every right to do, unlike CI Host do with AOL
 
I would agree on the above statement there John

Originally posted by GamesCreation
I disagree though, there will be more damage done by a bigger company hosting loads of people than a smaller company hosting fewer people. And the more damage done, the more they should pay.


Its the same amount of damange... just a larger host will have more windows servers up (more licenses) than a smaller one. The amount of clients doesnt have anything to do with it.

Unless MS sees it that by CI using unlicensed it damanged their repuatation somehow.
 
I have a different point of view because of them sueing AOL over something so stupid, they are out to get as much money as they can and I dont think they have the right to complain when MS as doing something they have every right to do, unlike CI Host do with AOL

Exactly, it's like on one hand they're complainingabout people taking money from them even though they hace the ight to as they were in the wrong, and on the other hand they are taking money from other people to get as much as possible, for no real good reason!

In a way, it seems nice to see Microsoft suing someone else. Almost every week, there seems to be some company or another suing microsoft for some stupid thing.
 
Vovex Technology said:
Microsoft is a pain in the ass..... think about it. Out of all the people in the world that pirate Microsoft products they go after a large company... so not only can get their money for the licensing but Im sure millions for "Business damanages". If I were in CI hosts shoes I would try settle this one out of court.... then maybe start giving their techs some lessons on Linux... the free OS :)

That is true Voxex
 
Update: CI Host files counter-complaint against Microsoft

Not much new, but here is an excerpt:

(In the counter-complaint, filed Tuesday in U.S. District Court in Fort Worth, CI Host says Microsoft "maliciously and intentionally" published false information to third parties about the Bedford-based company.

CI Host also denied that it had any licensing agreements or contracts in place with Microsoft that would have required it to pay fees for using Microsoft products. Still, the company pays a $600 licensing fee for every server it uses with a Microsoft operating system, a CI Host spokesman said.

CI Host is seeking punitive and exemplary damages, along with attorneys' fees, although it didn't specify an amount in the counter-complaint. )
 
Wow what a twist to this story...
Wonder what the actual truth is though, would Microsoft really try damage the reputation of a company which is *miniscule* compared to it and not even in the same market?
I just dont see a point why they would waste their time doing that to CI Host so Im guessing theres more to this than is already available to the public
 
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