LOS ANGELES (Reuters) - Microsoft Corp. faces a proposed class-action lawsuit in California based on the claim that its market-dominant software is vulnerable to viruses capable of triggering "massive, cascading failures" in global computer networks.

The lawsuit, which was filed Tuesday in Los Angeles Superior Court, also claims that Microsoft's security warnings are too complex to be understood by the general public and serve instead to tip off "fast-moving" hackers on how to exploit flaws in its operating system.

The suit claims unfair competition and the violation of two California consumer rights laws, one of which is intended to protect the privacy of personal information in computer data bases. It asks for unspecified damages and legal costs, as well as an injunction against Microsoft barring it from unfair business practices.

Many of the arguments in the lawsuit and some of its language echoed a report issued by computer security experts in late September, which warned that the ubiquitous reach of Microsoft's software on desktops worldwide had made computer networks a national security risk.

That report presented to the Computer and Communications Industry Association, a trade group representing Microsoft's rivals, said the complexity of Microsoft's software made it particularly vulnerable.

Microsoft said it had received a copy of the lawsuit and that its lawyers were reviewing it, but could not comment immediately.

Dana Taschner, a Newport Beach, Calif., lawyer who filed the lawsuit on behalf of a single plaintiff and a potential class of millions of Microsoft customers, could not immediately be reached for comment.

"Microsoft's eclipsing dominance in desktop software has created a global security risk," the suit says. "As a result of Microsoft's concerted effort to strengthen and expand its monopolies by tightly integrating applications with its operating system ... the world's computer networks are now susceptible to massive, cascading failure."

With some $49 billion in cash and more than 90 percent of the market in PC operating systems, Microsoft has long been seen as a potential target for massive liability lawsuits.

But the company, which has been moving to settle anti-trust claims that it abused its monopoly on PC software, also has been seen as shielded from liability claims by disclaimers contained in the licenses that users must agree to when installing software, according to experts.

The lawsuit comes in the wake of two major viruses recently that have taken advantage of flaws in Microsoft software.

Slammer, which targeted computers running Microsoft's server-based software for databases, slowed down Internet traffic across the globe and shut down flight reservation systems and cash machines in the United States.

The Blaster worm, meanwhile, burrowed through hundreds of thousands of computers, destroying data and launching attacks on other computers.

Since early 2002, Microsoft has made computer security a top priority under a Trustworthy Computing initiative spearheaded by the company's founder and chairman, Bill Gates.

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