Toshiba/Microsoft Saga

Geoffrey D. Bennett
12/Aug/1998

I hope that this web page will prove useful to those people who want to purchase a laptop without Microsoft Windows. The short summary is:

I purchased a Toshiba notebook on February 2nd this year from my local Linux-friendly supplier (Nick Stock at Cybernet Systems). Being the devoted Linux user I am, I didn't want to pay for a copy of Microsoft Windows if I wasn't going to use it. Unfortunately, Nick informed me that it was impossible to purchase a Toshiba (or practically any brand of notebook) without Windows coming along for the ride.

When I received the computer, I noted that the ``End User License Agreement for Microsoft Software'' stated that I did not have to accept the agreeement, and if I didn't agree to its terms, I could contact the manufacturer for instructions on returning the software for a refund. That seemed like just what I wanted, so I contacted Toshiba in Adelaide and spoke with Kon Karanastasis.

Kon had apparently never heard of anyone wanting to return just the software for a refund, so it took a while to explain what I wanted. "I want to give you back the Microsoft software and receive a cheque in return", "We don't do that", "But the license agreement that Toshiba supplied with my computer says you will". Kon asked that I send him a letter explaining what I wanted, along with a copy of the invoice for the notebook and he'd find out what could be done.

Here's the letter:

NetCraft Australia
PO Box 390 Blackwood 5051
Phone: 08 8370 3650
Fax: 08 8278 8325

2 February 1998

Mr. Kon Karanastasis
Toshiba
5 Hurtle Square
Adelaide SA 5000

Dear Kon,

With reference to my phone call to you today, I have purchased a Toshiba Satellite Pro laptop computer which included a copy of Microsoft Windows 95 pre-installed. The ``End-User License Agreement For Microsoft Software'' included with the computer states in part:

If you do not agree to the terms of this EULA, PC Manufacturer and Microsoft are unwilling to license the SOFTWARE PRODUCT to you. In such event, you may not use or copy the SOFTWARE PRODUCT, and you should promptly contact PC Manufacturer for instructions on return of the unused products(s) for a refund.

I do not agree to the terms of the End-User License Agreement for the Windows 95 software, and would like to return the software for a refund. Please supply me with instructions on how to return the software.

As you requested, I have enclosed a copy of the invoice for the Toshiba laptop computer.

Regards,

(signed)

Geoffrey D. Bennett
Computer Systems Manager
NetCraft Australia

Kon got back to me and the word from Sydney was that Toshiba would be happy for me to return my notebook and receive a full refund, but they were not willing to give me a refund on just the Microsoft Software. I explained that this was unacceptable; the license agreement for the Software specifically said that I could return just the Software. Too bad apparently; Toshiba have a contractual agreement with Microsoft where they can't unbundle the software from the hardware, therefore they wouldn't give me a refund.

I obviously wasn't happy with this, so Kon said that the person to talk to was Laurence White from Product Planning in Toshiba. I sent him an email explaining the situation:

Date: Tue, 3 Mar 1998 16:25:06 +1030 (CST)
From: "Geoffrey D. Bennett" [email address removed]
To: [email address removed]
Subject: Return of unused software

Dear Laurence,

Kon Karanastasis from Toshiba in Adelaide said that I should contact
you regarding the return of the unused Microsoft software that came
with my Toshiba laptop.

On the 2nd of February this year, I purchased a Toshiba Satellite Pro
laptop computer which included a copy of Microsoft Windows 95
pre-installed.  The ``End-User License Agreement For Microsoft
Software'' that was included with my computer states in part:

  If you do not agree to the terms of this EULA, PC Manufacturer and
  Microsoft are unwilling to license the SOFTWARE PRODUCT to you.  In
  such event, you may not use or copy the SOFTWARE PRODUCT, and you
  should promptly contact PC Manufacturer for instructions on return
  of the unused products(s) for a refund.

I did not agree to the terms of the End-User License Agreement for the
Microsoft software, so I refrained from using the software, and I
completely removed it without creating any backup.

I would now like to return the unused software product for a refund.
Could you please supply me with instructions on how to return the
software and obtain a refund.

Regards,
-- 
Geoffrey D. Bennett [email address removed]
Computer Systems Manager, NetCraft Australia
http://www.netcraft.com.au/geoffrey/
Red Hat Linux Resellers: http://www.netcraft.com.au/redhat/
Laurence told me essentially the same thing that Kon did. I can return the notebook, but I can't return just the Software: 
Date: Thu, 05 Mar 98 10:08:40 
From: "laurence white" [email address removed]
To: "Geoffrey D. Bennett" [email address removed]
Subject: Re: Return of unused software

     Hello Geoffrey,
     
     I am the Toshiba Product Manager and am responsible for all notebooks.
     
     The EULA you have received is a generic Microsoft document supplied by all 
     manufacturers as proof of the purchase of your operating system.
     
     As you can see in the wording of the text you need to contact a vendor for 
     instructions and Toshiba is unwilling to refund the cost of the operating 
     system.
     
     Toshiba is required by Microsoft contract to provide and purchase a valid 
     operating system. Toshiba cannot get a refund from Microsoft.
     
     I hope you can understand our position. Toshiba must pay Microsoft at point
     of manufacture and cannot get a refund from Microsoft, so we can't refund 
     you.
     
     If we gave you a refund on the operating system component then Toshiba 
     cannot claim this on Microsoft.
     
     I hope this explains our position with Microsoft Software.
     
     Regards
     Laurie White
     Toshiba Australia

(my original message was included here)
If at first you don't succeed... so I asked again, explaining why his reasons for refusing a refund were not valid: 
Date: Thu, 19 Mar 1998 02:26:22 +1030 (CST)
From: "Geoffrey D. Bennett" [email address removed]
To: [email address removed] (laurence white)
Subject: Re: Return of unused software

Hi Laurie,

Thank you for your reply to my message regarding the return of unused
Microsoft software.  Although I understand Toshiba's position, it is
not acceptable for reasons I give below, and therefore, I would like
to request for the second time you to send me instructions on how to
return the unused Microsoft software to Toshiba and obtain a refund
for that software.

You wrote:

> Hello Geoffrey,
> 
> I am the Toshiba Product Manager and am responsible for all notebooks.
> 
> The EULA you have received is a generic Microsoft document supplied by all 
> manufacturers as proof of the purchase of your operating system.

I'm not sure how this is relevant?  The EULA certainly is my proof of
purchase, but it is a lot more than that.  The EULA states the terms
under which the software is to be licensed to me under.  I have
rejected those terms, and according to the agreement I may not use or
copy the software and I should return it for a refund.

The EULA is the document that specifically says that PC Manufacturer
(Toshiba in this case) and Microsoft are unwilling to license the
software to me, and I should contact Toshiba for instructions on
returning the software for a refund.

> As you can see in the wording of the text you need to contact a vendor for 
> instructions and Toshiba is unwilling to refund the cost of the operating 
> system.

Toshiba might be unwilling this month to refund the cost of the
operating system to me, but the EULA which was sent to me last month
by Toshiba with the computer when I purchased it does not include a
provision for you to reject my claim for a refund.

If Toshiba were not willing to refund the cost of unwanted software to
me when I purchased the product, Toshiba should not have supplied me
with a license agreement that states that I can return the software
for a refund.

> Toshiba is required by Microsoft contract to provide and purchase a valid 
> operating system. Toshiba cannot get a refund from Microsoft.

The agreement between Toshiba and Microsoft is irrelevant to me.

The agreement between myself, Toshiba, and Microsoft says that I can
return the product for a refund.  Whether or not Toshiba can then
receive a refund from Microsoft is really none of my business.

> I hope you can understand our position. Toshiba must pay Microsoft at point
> of manufacture and cannot get a refund from Microsoft, so we can't refund 
> you.
> 
> If we gave you a refund on the operating system component then Toshiba 
> cannot claim this on Microsoft.
> 
> I hope this explains our position with Microsoft Software.

I do understand your position, but if Toshiba enter into an agreement
with Microsoft where Toshiba is required to purchase Microsoft
software for each notebook, then Toshiba should be willing to wear the
cost of that software if I do not want to purchase that software from
you.

Surely the discounts obtained by purchasing Microsoft software with
every notebook manufactured far outweigh the cost associated with me
not wanting to purchase the Microsoft software from Toshiba?  If they
don't, perhaps Toshiba should review their agreement with Microsoft.

I look forward to your reply.

Regards,
Geoffrey.

(my original message was included here)

-- 
Geoffrey D. Bennett [email address removed]
Computer Systems Manager, NetCraft Australia
http://www.netcraft.com.au/geoffrey/
Red Hat Linux Resellers: http://www.netcraft.com.au/redhat/
He obviously didn't like my arguments: 
Date: Thu, 19 Mar 98 09:38:15 
From: "laurence white" [email address removed]
To: "Geoffrey D. Bennett" [email address removed]
Subject: Re[2]: Return of unused software

     Geoffrey,
     
     Toshiba is happy for you to return the complete computer system for a 
     refund to the place of purchase. We are not willing to sell just the 
     computer system to you.
     
     If you have any further questions regarding this matter you will need 
     to talk with our legal department.
     
     Regards
     Laurie White

(my first reply was included here)

I called the ACCC (Australian Competition and Consumer Commission) who said that selling one product bundled with another as Toshiba are doing is an okay thing to do, and then I called Consumer Affairs who suggested I see a lawyer. I ended up going to see someone from the Legal Services Commission who said that I could take my case to the small claims court and I'd probably win, but if I didn't then I'd be up for their expenses (plane trip from Sydney plus hotel accomodation). I definitely didn't want to take that risk, so I decided to give in.

By this time, the model of notebook I had purchased was discontinued (it had been about two months since I purchased it) and the next model up was $700 cheaper than what I had paid for mine. Since Toshiba were offering me the chance to return the entire computer, this was obviously a good deal. They were effectively offering me $700 and a notebook upgrade :-). I didn't really want to pursue this option, since I would still be paying for a copy of Microsoft Windows that I didn't want (it's the principle of the thing!), but I didn't see any other option.

So I contacted Nick, who was quite happy to take the computer back from me provided that his supplier would take it back from him. Unfortunately, his supplier didn't like this idea and were quite ticked off that Toshiba would say to me that I could return a pre-loved, two-month old, and discontinued computer at their expense. They wanted to know who at Toshiba told me this.

I then get an email (quite unexpectedly) from Kon Karanastasis, who wrote: 
Date: Thu, 02 Apr 98 13:46:11 
From: "kon karanastasis" [email address removed]
To: [email address removed]
Subject: Return of Unused Software

Dear Geoffrey

In respect to your formal request for a refund for unused software on your 
Toshiba Laptop Computer the matter is currently being assessed by our
General Affairs Division.

Before they reach a final decision they have asked me the following questions
in respect to your purchase ;         
          
          
1.       Mr Bennett states that he purchased the computer on 2nd 
          February 1998. 
          
          From whom did Mr Bennett purchase the computer?
          
2.      Did he rely on a brochure in making his decision?
          
3.      At the time of purchase did he notify the vendor that he did 
         not want the standard MS operating system?
          
4.       Did Mr Bennett read the End User License Agreement prior to 
          turning on the Computer for the first time?
          
5.       Mr Bennett states that he "refrained from using the 
          software, and .... completely removed it without creating 
          any backup". How was this accomplished? When was the 
          Operating System deleted?
 
6.        Has the computer been used between the dates of 2nd February 
          1998 and 3rd March 1998? If in the affirmative, utilising 
          what operating system?
          
If you could please provide answers to these questions, I will ensure a speedy
resolution
of this issue.           
          
          
                Regards
                Kon Karanastasis
        Toshiba ISD

        Email Add : [email address removed]
        Phone : 08 8223 2878
        Fax : 08 8232 5022

I thought that the above message was a bit strange, since I hadn't talked to Kon for quite a while now, and I wasn't asking them consider a refund for the unused software anymore. I wrote the following email back:

Date: Thu, 2 Apr 1998 15:42:33 +0930 (CST)
From: "Geoffrey D. Bennett" [email address removed]
To: [email address removed] (kon karanastasis)
Subject: Re: Return of Unused Software

Dear Kon,

You wrote:

> Dear Geoffrey
> 
> In respect to your formal request for a refund for unused software on your 
> Toshiba Laptop Computer the matter is currently being assessed by our
> General Affairs Division.

I'm a bit confused here, because my refund for unused software has
been assessed and denied three times already, each time with an offer
for me to return the entire computer, and the last time also telling
me that I'd need to contact Toshiba's Legal Department if I wanted to
take the issue of returning just the software any further.  After the
three refusals, I decided to take up the multiple offers of returning
the computer, so I contacted my supplier to arrange doing so.

Are Toshiba now reconsidering the refund for the unused software?  If
so, that is fine, but if it is refused (for the fourth time), I will
be again wanting to take you up on your offer for me to return the
entire computer.

> Before they reach a final decision they have asked me the following questions
> in respect to your purchase ;         
> 
> 1.       Mr Bennett states that he purchased the computer on 2nd 
>           February 1998. 
>           
>           From whom did Mr Bennett purchase the computer?

I purchased the computer from Nicholas Stock at Cybernet Systems
(017 864 264).  I sent you a copy of the invoice on February 2nd.

> 2.      Did he rely on a brochure in making his decision?

No, I didn't rely on a brochure in making my decision.  I read many
brochures, viewed many web pages, and talked to many people when
deciding which notebook to purchase.

> 3.      At the time of purchase did he notify the vendor that he did 
>          not want the standard MS operating system?

My vendor was aware before I purchased the computer that I did not
want the standard MS operating system.  My vendor had already informed
me that it was not possible to have Windows removed from the computer
before purchasing it.

> 4.       Did Mr Bennett read the End User License Agreement prior to 
>           turning on the Computer for the first time?

I did.  The license agrement said that if I did not agree to its
terms, Toshiba and Microsoft were unwilling to license the software to
me, and I could return the software for a refund.  Therefore, I did
not use the software, and I contacted Kon to arrange a refund.

> 5.       Mr Bennett states that he "refrained from using the 
>           software, and .... completely removed it without creating 
>           any backup". How was this accomplished? When was the 
>           Operating System deleted?

I removed the operating system by connecting the floppy disk drive,
inserting a Red Hat Linux boot floppy, turning on the computer,
deleting all partitions on the hard disk, and installing Linux.  I did
this on the same day I received the computer.

> 6.        Has the computer been used between the dates of 2nd February 
>           1998 and 3rd March 1998? If in the affirmative, utilising 
>           what operating system?

Yes, the computer has been used the entire time I have had it.  The
operating system used has been the Red Hat Linux operating system.

> If you could please provide answers to these questions, I will ensure a speedy
> resolution
> of this issue.           

Thank you,
-- 
Geoffrey D. Bennett [email address removed]
Computer Systems Manager, NetCraft Australia
http://www.netcraft.com.au/geoffrey/
Red Hat Linux Resellers: http://www.netcraft.com.au/redhat/
The next day I received an email back from Kon: 
Date: Fri, 03 Apr 98 13:14:32 
From: "kon karanastasis" [email address removed]
To: "Geoffrey D. Bennett" [email address removed]
Subject: RE: Return of Unused Software

Geoffrey

Toshiba's General Affairs Division have assessed your claim for a refund of the
unused Microsoft Software.

Toshiba is prepared to offer you $110.00 (AUS) as a refund for not using the 
bundled software.

Please confirm your acceptance (or otherwise) of this offer and we will
implement the
appropriate actions to settle this matter.

Regards

Kon Karanastasis 

(the message he replied to was included here)
Since this was exactly what I was wanting, I wrote back: 
Date: Fri, 3 Apr 1998 16:21:43 +0930 (CST)
From: "Geoffrey D. Bennett" [email address removed]
To: [email address removed] (kon karanastasis)
Subject: Re: Return of Unused Software

> Geoffrey
> 
> Toshiba's General Affairs Division have assessed your claim for a refund of the
> unused Microsoft Software.
> 
> Toshiba is prepared to offer you $110.00 (AUS) as a refund for not using the 
> bundled software.
> 
> Please confirm your acceptance (or otherwise) of this offer and we will
> implement the
> appropriate actions to settle this matter.

Hi Kon,

That sounds good.  Let me know what the next step is.

Regards,
-- 
Geoffrey D. Bennett [email address removed]
Computer Systems Manager, NetCraft Australia
http://www.netcraft.com.au/geoffrey/
Red Hat Linux Resellers: http://www.netcraft.com.au/redhat/

Time passed, and I called Kon to find out what was happening to my cheque. He explained that in big companies, weird things like giving money to customers for return of Microsoft software can take a while to happen. A little later I received an email from him:

Date: Thu, 07 May 98 14:51:43 +1000
From: "KON KARANASTASIS"[email address removed]
To: [email address removed]
Subject: Refund for Unused Software

Geoffrey

I've followed up the progress of your refund cheque.

I still can't give you a definite date, however, I think I've managed to
put some higher priority on your claim.

Hopefully it should all be resolved within a fortnight.

Regards

Kon Karanastasis

Email : [email address removed]
And then the email I was waiting for: 
Date: Thu, 21 May 98 10:46:44 +1000
From: "KON KARANASTASIS"[email address removed]
To: [email address removed]
Subject: Refund Cheque

Hi Geoffrey

Your refund cheque has arrived in Adelaide.

If you would like to return all documentation/software relating to MS Windows to
Our office at 5 Hurtle Square you can pick up your cheque.

Regards

Kon Karanastasis

I couldn't pick up the cheque immediately because I had just left for Linux Expo, but when I got back I wasn't in any particular hurry to get the cheque because it was the principle of the thing, not the money. After some hassling from a couple of LinuxSA members at the July meeting, I finally went to Toshiba on the 10th of August to pick up my cheque.

Lo and behold, I now have a cheque for $110 from Toshiba in return for an unused license for Microsoft Windows!

Many thanks to:

No thanks to:

If there's anyone else wanting to do a similar thing, I think that the important things are: