Software giant adds to defense with new filing in government antitrust case.
Published:
23 May 2000 y., Tuesday
In an unexpected court filing Monday, Microsoft Corp. tried to use the government's own words against it as justification for not breaking up the company. In a filing with the U.S. District Court for the District of Columbia, Microsoft repeated an earlier request that Judge Thomas Penfield Jackson, who is overseeing the antitrust proceeding, immediately dismiss the government's proposal to divide the company in two. In its argument against a breakup, Microsoft referred to an earlier case against the company that ended in a settlement and a consent decree, which the Justice Department alleges Microsoft later violated.
In its filing, Microsoft said that government attorneys admitted in the earlier case that a breakup of the company would be dangerous to the economy's welfare and against the public interest.
However, antitrust experts said that Microsoft was found to have engaged in a wide variety of anti-competitive conduct since 1995, making the company's legal position very different now than it was five years ago. Five years ago, various private-sector witnesses filed a memorandum with U.S. District Judge Stanley Sporkin saying that the court should require Microsoft to divest its applications businesses to create a "Chinese Wall" between the company's applications and operating system employees. In response, attorneys for the government said that "the law would not permit the sweeping remedies" that those witnesses suggested, and that "remedies such as dismembering Microsoft would act against the public interest." Microsoft's actions after the 1995 consent decree However, the case that the government filed against Microsoft in 1998 alleges that the company engaged in a wide range of anti-competitive conduct that wasn't at issue in 1995, including: seeking to divide the Web browser market with Netscape Communications and later attempting to snuff out Netscape; interfering with Intel's multimedia technology decisions; forcing Apple to accept Microsoft's Web browser under threat of losing Microsoft's Office suite of applications for the Macintosh; and imposing exclusionary deals on dozens of Internet service and content providers.
A government official told CNNfn that Microsoft's filing made Monday "relies on statements made by the government before Microsoft engaged in numerous illegal acts found by the court in the current case. The fact that Microsoft repeatedly violated the law after the proceedings demonstrates why structural relief is necessary to prevent antitrust violations in the future." Separately, Microsoft's filing states that "the government fails to identify a single case in which the court ordered the breakup of a unitary company such as Microsoft outside of the context of negotiated consent decrees." "In short, when it comes to the controlling case law, the government essentially punts -- there is no precedent for ordering the dismemberment of a unitary operating company." Microsoft's filing also said that Judge Jackson didn't conclude that Netscape's Navigator and Sun Microsystems' Java technology would have created competition in the market for PC operating systems, even if Microsoft hadn't engaged in anti-competitive behavior.
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