Suing Microsoft as per a dual-contract agreement
August 12, 2010 6:35 AM Subscribe
Suing Microsoft as per a dual-contract agreement: if a breach of contract occurs that breaches the terms of both contracts, do both contracts get breached simultaneously, or just one of them (according to the order of priority of contracts)?
For the record: I am writing this not for legal advice per se; rather, I'd appreciate it if someone could share their experiences in suing/settling with mega-corporations (of any sort), especially if it involves Microsoft, and of handling multi-contract business arrangements.
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I'm a newly-minted lawyer (hence, why I'm writing this; i.e. my lack of experience) based in the Asian region. One of the files at my current firm (and which I am doing) involves a contractual dispute between my client company, a supply provider to the government, and Microsoft.
Microsoft has been a problematic experience for my client: it has been delaying delivery of its code for months (and forcing my client to go through bureaucratic loops to get time extensions on its behalf), making arrogant one-sided demands in meetings, implying representations and duties on my client that has never existed, and worst of all, Microsoft seems very intent (all too eager too, I might add) to terminate its contract with my client lately.
My guess as to why Microsoft is so eager to terminate the contract is because they think they're protected by it:
* The contract has tons of one-sided clauses that completely absolve Microsoft of liabilities for direct and indirect damages (economic loss, consequential damages, loss of business, etc) arising from breach of contract/tort/negligence/you-name-it.
* The contract supposedly prevents the other party from taking up terms/conditions/warranties against Microsoft.
* The contract supposedly allows survival/waiver terms (favourable to Microsoft) to be "revived", even when those terms have been struck out by a court of law.
* There are clauses that even try to get the contracting parties to waive the power of court orders as against certain terms of the contract.
* The fact that Microsoft has little to lose from terminating the contract, and has lost little before this (unlike what my client has already suffered, and will later suffer, e.g. fines up to USD30,000 per day of late delivery); i.e. Microsoft will be able to get away scot-free, with its reputation intact, while my client goes bankrupt and gets blacklisted.
Fortunately the contract between my client and Microsoft was made in a jurisdiction whose laws prevent unfair contract terms, and so at least the troublesome clauses can be wiped out, for a start. But still, my main concern is this: my client signed two agreements with Microsoft -- one, a Master Services Agreement, and two, a 'Statement of Services' (I won't write the actual name of the service provided, for purposes of anonymity). My questions:
* Are these kinds of multi-contract agreements common? Aren't contracts usually a singular thing?
* Where no priority of importance is specified in multi-contract agreements, if events occur that seemingly breach the terms of both contracts, does any contract take precedence in being breached, or do both contracts get breached simultaneously? (i.e. In the event of a breach of contract, say a late delivery of code, which contracts have been breached? One, or both?)
* Does Microsoft have a reputation of being a problematic service provider?
* Anyone else here dealt with Microsoft before in a business setting? How are they? (Some senior Microsoft execs were flown in the other day when the dispute talks were being held; I wasn't there, but the other lawyers who did go described Microsoft as being fearful about losing its reputation, and really scared enough to demand that no news of a termination, whether one goes through or not, should be picked up by the blogosphere.)
For the record: I am writing this not for legal advice per se; rather, I'd appreciate it if someone could share their experiences in suing/settling with mega-corporations (of any sort), especially if it involves Microsoft, and of handling multi-contract business arrangements.
===========
I'm a newly-minted lawyer (hence, why I'm writing this; i.e. my lack of experience) based in the Asian region. One of the files at my current firm (and which I am doing) involves a contractual dispute between my client company, a supply provider to the government, and Microsoft.
Microsoft has been a problematic experience for my client: it has been delaying delivery of its code for months (and forcing my client to go through bureaucratic loops to get time extensions on its behalf), making arrogant one-sided demands in meetings, implying representations and duties on my client that has never existed, and worst of all, Microsoft seems very intent (all too eager too, I might add) to terminate its contract with my client lately.
My guess as to why Microsoft is so eager to terminate the contract is because they think they're protected by it:
* The contract has tons of one-sided clauses that completely absolve Microsoft of liabilities for direct and indirect damages (economic loss, consequential damages, loss of business, etc) arising from breach of contract/tort/negligence/you-name-it.
* The contract supposedly prevents the other party from taking up terms/conditions/warranties against Microsoft.
* The contract supposedly allows survival/waiver terms (favourable to Microsoft) to be "revived", even when those terms have been struck out by a court of law.
* There are clauses that even try to get the contracting parties to waive the power of court orders as against certain terms of the contract.
* The fact that Microsoft has little to lose from terminating the contract, and has lost little before this (unlike what my client has already suffered, and will later suffer, e.g. fines up to USD30,000 per day of late delivery); i.e. Microsoft will be able to get away scot-free, with its reputation intact, while my client goes bankrupt and gets blacklisted.
Fortunately the contract between my client and Microsoft was made in a jurisdiction whose laws prevent unfair contract terms, and so at least the troublesome clauses can be wiped out, for a start. But still, my main concern is this: my client signed two agreements with Microsoft -- one, a Master Services Agreement, and two, a 'Statement of Services' (I won't write the actual name of the service provided, for purposes of anonymity). My questions:
* Are these kinds of multi-contract agreements common? Aren't contracts usually a singular thing?
* Where no priority of importance is specified in multi-contract agreements, if events occur that seemingly breach the terms of both contracts, does any contract take precedence in being breached, or do both contracts get breached simultaneously? (i.e. In the event of a breach of contract, say a late delivery of code, which contracts have been breached? One, or both?)
* Does Microsoft have a reputation of being a problematic service provider?
* Anyone else here dealt with Microsoft before in a business setting? How are they? (Some senior Microsoft execs were flown in the other day when the dispute talks were being held; I wasn't there, but the other lawyers who did go described Microsoft as being fearful about losing its reputation, and really scared enough to demand that no news of a termination, whether one goes through or not, should be picked up by the blogosphere.)
This post was deleted for the following reason: poster's request -- jessamyn
Two notes:
(1) it would likely help to know the jurisdiction to which this question pertains, and
(2) MSFT is such a large company that many thousands of people have dealt with it in a "business setting," some of whose experiences may be relevant, and most of whose experiences are irrelevant.
posted by dfriedman at 6:39 AM on August 12, 2010
(1) it would likely help to know the jurisdiction to which this question pertains, and
(2) MSFT is such a large company that many thousands of people have dealt with it in a "business setting," some of whose experiences may be relevant, and most of whose experiences are irrelevant.
posted by dfriedman at 6:39 AM on August 12, 2010
This is a question better posed to your colleagues than on AskMe. You are talking about pending litigation here, and you're at the front of the list of people who could get in trouble.
posted by valkyryn at 6:49 AM on August 12, 2010
posted by valkyryn at 6:49 AM on August 12, 2010
Everything depends on the applicable jurisdiction. It may also depend on a choice of law clause in the contract (e.g., if it were the US, then contract law is a state matter, and the contract would specify which state's laws apply; Microsoft usually chooses the state of Washington). You've said "the Asian region," but there is an enormous diversity of law in Asia. There aren't really any general principles to apply, especially for something this complex.
Furthermore, I don't know what kind of legal ethical rules apply in your jurisdiction, but in the US talking about the details of a case like this on a public web forum would be a tremendously bad idea for lots of reasons. So, echoing what valkyryn said, you probably shouldn't be asking these questions here at all.
posted by jedicus at 6:56 AM on August 12, 2010
Furthermore, I don't know what kind of legal ethical rules apply in your jurisdiction, but in the US talking about the details of a case like this on a public web forum would be a tremendously bad idea for lots of reasons. So, echoing what valkyryn said, you probably shouldn't be asking these questions here at all.
posted by jedicus at 6:56 AM on August 12, 2010
This thread is closed to new comments.
posted by Admiral Haddock at 6:38 AM on August 12, 2010