Business

Justice eyes Microsoft-Novell patent deal

Microsoft’s attempt to gain a stronger position in the Linux market might be coming to an end, The Post has learned.

The Justice Department is giving a Microsoft-led group’s $450 million purchase of 882 patents from Novell a “pretty serious review,” a source close to the situation who is not working for or against the deal said yesterday.

“They could possibly nix the sale,” the source added.

Novell in November reached simultaneous deals to sell the patents to a group including Microsoft, Apple, EMC and Oracle and the rest of Novell to Attachmate in a deal totaling $2.2 billion. The Attachmate deal is contingent on the patent sale.

Attachmate agreed to pay Novell $6.10 a share. Yesterday, Novell shares closed at $5.87.

Novell is expected within days to answer a DOJ second request for information, and a DOJ ruling would come roughly a month after that is submitted, sources said.

The concern is Microsoft, which already claims Linux open-source software violates its patents, could control more of the valuable Linux market, and exclude rivals, including Red Hat, which sells its own Linux product.

A possible DOJ remedy could be requiring Microsoft to only use the acquired patents for defensive purposes, the source said.

Microsoft last month signed a patent cross-licensing agreement with Amazon allowing it to use Linux.

Despite Google using Linux to power Google Search and Android, it does not pay Microsoft any fees. Google and others have questioned Microsoft’s claims of patent rights over Linux.

Part of the DOJ’s frustration is it does not have the manpower to review 882 patents, sources said.