[Am-info] MS deposition in antitrust suit is damaging

[Gene Gaines]

,

Courtesy of David Farber's IP elist.

I saw this before, but did not realize how outrageous until I read
in this article:

http://www.computeruser.com/news/02/02/21/news10.html


Microsoft official: firm uses settlement against PC makers
By Brian Krebs, Newsbytes
February 21, 2002

An antitrust settlement designed to punish Microsoft Corp. for its anticompetitive
actions may have helped the software giant extract valuable concessions from the
very companies it was accused of harming in the first place, according to
testimony from a senior Microsoft official.

The revelations surfaced following the deposition of Microsoft Vice President
Richard Fade, who conceded in the interview that Microsoft profited from the
settlement by using it to win concessions from computer manufacturers that it
would not have been able to secure otherwise.

Fade, who manages Microsoft's dealings with computer manufacturers, told
attorneys for the states still suing the company that shortly after Microsoft and
the U.S. Justice Department announced their settlement proposal last fall,
Microsoft initiated new, non-negotiable terms for PC makers that license the
Windows operating system.

Fade said that as a result of the settlement, every one of the world's top 20 PC
makers--particularly Gateway and Hewlett-Packard ­ believes Microsoft already
has benefited from the proposal.

The most valuable gain from the settlement plan, Fade said, was the inclusion of a
"non-assertion of patents" clause that prevents PC makers from enforcing their
patents against Microsoft.

That key provision allows Microsoft to compete with computer makers in the
making of products that essentially are PCs ­ such as Microsoft's new Xbox game
console. As a result, Microsoft is now able to gain access to rivals' patented
technologies in order to develop similar products.

The nine states that have refused to endorse the settlement filed a brief on
Tuesday urging Judge Collen Kollar-Kotelly to include Fade's testimony in a March
6 hearing on whether the settlement should be approved.

Meanwhile, the court will hold hearings beginning March 11 to examine the
sanctions sought by the states still suing Microsoft.




Gene Gaines
gene.gaines@gainesgroup.com
Sterling, Virginia