Gates and Ballmer named in lawsuit for failing to manage the company properly during IE antitrust probe
In March of 2013, the European Union (EU) fined Microsoft for breaking a legally binding commitment (forged in 2009) that ensures consumers in Europe would be able to choose a default internet browser, rather than defaulting to Microsoft’s own Internet Explorer. The investigation determined that consumers were not given a choice between May of 2011 and July of 2012, resulting in 15 million users being “forced” to use Internet Explorer. Microsoft blamed a technical error for the browser mishap and the company was fined $731 million by the EU.
Now, a shareholder named Kim Barovic has taken it to federal court to charge Microsoft directors and executives – specifically founder Bill Gates and former CEO Steve Ballmer – for failing to to manage the company properly and for an insufficient attempt at an investigation by the board. Barovic wants Microsoft’s board to fully investigate how the mistake occurred and to take action against any director or executive that failed to perform their duties. Microsoft, on the other hand, disagrees that any wrongdoing by an executive had taken place.
“Ms. Barovic asked the board to investigate her demand and bring a lawsuit against the board and company executives,” Microsoft stated in an email statement. “The board thoroughly considered her demand as she requested and found no basis for such a suit.”
When this issue came to light back in 2012, Steve Ballmer, who was the CEO at the time, and Steven Sinofsky, the head of the Windows unit at the time, both had their bonuses cut.
More on this as it develops.Further reading: Internet Explorer, Microsoft