Be Sues Microsoft For Alleged 'Destruction'

Menlo Park, California-based Be, most of which was acquired last year by handheld computer maker Palm Inc. , said in a filing with federal court in San Francisco that Microsoft struck deals with PC makers barring them from installing more than one operating system on computers they sold.

"Microsoft harmed Be through a series of illegal exclusionary and anticompetitive acts designed to maintain its monopoly in the Intel-compatible PC operating system market," Be said in the statement.

The suit is the latest legal headache for Microsoft, which is battling a U.S. government antitrust suit as well as private class action suits and a new case filed by rival AOL Time Warner Inc. alleging Microsoft harmed its Netscape browser unit.

Microsoft was not immediately available to comment.

Last August, Be said it was selling its operating system, called the BeOS, to Palm for $11 million. Elements of BeOS are expected to be included in Palm's next operating system, Palm OS 5.

Shares in Be rose 2 cents, or 20 percent, in Nasdaq trading. While the company sold its product assets to Palm, it held on to other assets like cash and receivables, as well as some contract obligations and the right to pursue some legal action like antitrust claims.

The BeOS, introduced in 1990, had been hailed as a visionary product for its multimedia abilities, elegance and ability to run many programs at the same time.

But while it had a core of devoted fans, including science fiction writer Neal Stephenson, Be never achieved commercial success. Most recently, it powered a short-lived Web-oriented computer from Sony called the eVilla.

"The great idea behind BeOS was to start from a clean sheet of paper and design an OS the right way. And that is exactly what they did. This was obviously a good idea from an aesthetic standpoint, but does not a sound business plan make," Stephenson wrote in his 1999 operating system essay "In the Beginning Was The Command Line."

Be's founder, Jean-Louise Gassee, became a poster child for missed opportunities when he reportedly turned down an offer by Apple Computer Corp. in 1996 to buy the company for $125 million.

Gassee, according to the book "Apple Confidential," wanted $200 million. Apple eventually bought Next, a company started by Apple's co-founder and former chief executive, for $400 million. The Next operating system now powers Apple's newest computers.

In the late 1990's, Be also saw increased competition from the upstart Linux operating system, which gained ground as a free alternative to Windows and other proprietary software.

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