February 14, 1995: Apple Computer Expands Lawsuit Against San Francisco Canyon Company Developer to Microsoft and Intel The lawsuit concerns allegedly stolen Apple code used to enhance Microsoft Video for Windows technology.
The lawsuit comes to a head as Apple threatens a multi-billion dollar lawsuit against Microsoft. Meanwhile, Microsoft CEO Bill Gates threatens to cancel Office for Mac.
Stolen Apple code in Microsoft video for Windows?
Cupertino’s beef with the San Francisco Canyon Company started out fairly mundane, but threatened to blow up big. The lawsuit hit Apple hard.
In the 1990s, Apple’s QuickTime software put the company well ahead of its competitors when it came to video on personal computers. In 1992, Apple contracted software developer San Francisco Canyon to bring its QuickTime technology to Windows. The PC release of QuickTime arrived in November 1992. The following July, Intel hired San Francisco Canyon to improve the Microsoft Video software suite for Windows.
The problem began when Apple claimed the resulting software contained several thousand lines of code written while San Francisco Canyon was under contract with Cupertino. Apple sued the developers and on February 14, 1995, expanded the lawsuit to include Microsoft and Intel.
Not long after, a federal judge ordered Microsoft to stop distributing the current version of Video for Windows. A new version followed, with release notes saying it “does not contain low-level driver code that was licensed from Intel Corporation”.
Microsoft vs. Apple: Video for Windows lawsuit and Windows 95 beta
What would have been just another ordinary lawsuit over stolen Apple code has become much more fascinating as a result of the accusations leveled at Microsoft by Apple’s lawyers.
With Microsoft at the height of its success with Windows 95, Apple went into attack mode. Apple accused Microsoft of trying to undermine it by delaying beta versions of the new operating system to prevent Apple from making Macs compatible with Windows.
At that time, Microsoft provided software to approximately 40,000 independent software developers. However, the company withheld it from Apple unless Cupertino agreed to drop existing lawsuits against Microsoft. Redmond also wanted Apple to cancel OpenDoc, a software program developed by Cupertino that competed with Microsoft’s Object Linking and Embedding technology.
Microsoft CEO Pam Edstrom said: “Microsoft is under no legal obligation to give away beta copies of its software. Microsoft chooses to make pre-sale versions of its software widely available to software companies because they offer input that allows Microsoft to improve the product and because their livelihoods depend on Windows. Neither does Apple.”
Microsoft and Apple agree on stolen Apple code
Many saw this as an example of Microsoft defeating a smaller fringe developer. Like Los Angeles Times wrote:
“The latest dispute between Apple and Microsoft escalates a growing dispute between the two companies, which basically stems from their rivalry in the market for the basic core software that controls the nation’s personal computers. Microsoft makes the operating system, or core software, for about 85% of all computers, but it also wants the 15% that Apple controls.”
Eventually, Microsoft and Apple settled their dispute in August 1997. Apple agreed to drop all lawsuits against Microsoft, including the QuickTime source code. Apple also agreed to make Internet Explorer its default browser (later replaced by Safari).
Microsoft also threw Cuperta a lifeline by buying $150 million in non-voting Apple stock and continuing to support the Mac from a software perspective. The cash injection came at a time when Apple was reportedly facing bankruptcy within months.
It wasn’t long before Microsoft reached the peak of its tech bubble and began to decline in the early 2000s. And Apple released the original iMac, iTunes, iPod, iPhone and other products that fueled its rise to technological dominance.
