The High Court has ordered Microsoft Ireland Operations Limited and Microsoft Arabia Company Limited to disclose documents in several disputed categories in a commercial case brought by Arabic Computer Systems. The ruling concerns discovery only; it does not decide whether the allegations in ACS’s counterclaim are true.
Microsoft Ireland Operations Limited seeks more than $31 million from ACS under three channel partner agreements. National Technology Group is also sued on a guarantee. ACS denies the claim and alleges that the two Microsoft entities conspired to harm its business. The court had earlier dismissed the defendants’ application to set aside service of the proceedings in Ireland, and the parties agreed to proceed to a plenary hearing.
Mr Justice Mark Sanfey’s ruling addressed ACS’s motion for discovery. He ordered documents showing delivery of products listed on the claimed invoices, and documents indicating that each product was used by the end customer. He said a single document definitively establishing receipt could be sufficient; further use documents would not necessarily be required.
The judge refused ACS’s request for documents about its share of Microsoft business in Saudi Arabia between 2013 and 2017. The Microsoft entities had acknowledged ACS held a significant market share, and the judge considered a further search for evidence of a possible motive to be speculative.
The court also ordered communications between the Microsoft entities about ACS’s solvency and communications to third parties about its solvency or reseller status, from January 2016 to June 2018. ACS alleges the entities spread damaging rumours that it was close to bankruptcy. The judge said the request could test whether the alleged plan extended beyond the specific customers identified in the pleadings.
For allegations concerning public tenders, the court limited discovery to tenders listed in Attachment 9 to ACS’s replies to particulars. The Microsoft entities must disclose documents about internally agreed final discounts and discounts communicated to ACS, including rebates or incentives applied before, during or after an award. ACS must provide relevant tender dates if Attachment 9 does not already contain them. The judge excluded Attachment 8, which concerned customers ACS says it lost after alleged rumours about its solvency.
The judge also ordered discovery in categories 35 to 39 concerning investigations into alleged corruption, related communications and subsequent actions. ACS alleges the investigations damaged its business and that it was cleared. The ruling does not require Microsoft Corporation, the separate parent entity described in the evidence, to produce its documents. Any privilege claimed by the Microsoft entities must be identified in their discovery affidavit.
The parties were asked to prepare a draft order reflecting the ruling and consider any further orders, including costs. The judge allowed either side to apply to resolve any disagreement over the order’s terms.