In a divided ruling, the court sent the case back to a lower court for further hearings.
The suit alleges that Nebraskans who purchased Windows 98 were overcharged by Microsoft and that this was an abuse of its monopoly power, according to court documents. At issue in the case was whether those who bought the operating system software indirectly were eligible to sue. Although the lower court had ruled that they could not, the Nebraska high court ruled otherwise.
The lower court dismissed the case and, on appeal, the state supreme court initially upheld that ruling, before agreeing to re-hear the matter.
"The district court erred in its interpretation of the Act," the court said in Friday's opinion, ruling that applicable law does allow even those who did not purchase a good directly to bring a legal action.
The ruling comes as Microsoftin the European Union's antitrust investigation into the company. The software maker also in Minnesota on state antitrust charges. It has in several other states.
A Microsoft representative said the company was disappointed with the high court's ruling and reiterated the company's rejection of the allegations made in the suit
"Microsoft has been a market leader in delivering great software at very competitive prices, and has even reduced prices while adding features and functionality to its products," the representative said in an e-mail. "Our high volume, low cost business model empowers consumers and is the opposite of overcharging."