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Feds Could Block Microsoft Group's Bid For Novell Patents

This article is more than 10 years old.

Novell's (NOVL) deal to sell a collection of 882 patents to a group of large tech companies is running into trouble at the Justice Department, the New York Post reports. The company had agreed to sell the group of patents for $450 million to a group that includes Microsoft (MSFT), Apple (AAPL), EMC (EMC) and Oracle (ORCL). Novell has agreed to sell the rest of the company to the software maker Attachmate.

Some of the patents apparently relate to Novell's Linux business, which would be of interest to all of the participants in the deal. Microsoft, which leads the group, has refused to discuss why it formed a coalition to acquire the patents, rather than simply buying them outright on its own. (It certainly isn't about having enough cash.)

According to the Post, the DOJ is giving the patent portfolio deal "a pretty series review," and quotes a source saying the government "could possibly nix the deal." The story says the concern is that Microsoft, which already claims that the open-source operating system Linux violates its patents, could end up with more control of the Linux markets, hurting rivals like Red Hat (RHT).

The concerns about the deal are weighing on Novell shares this morning; the stock is down 8 cents, or 1.4%, to $5.79.