[Am-info] Holdouts in Microsoft Case Push for Tougher Penalties (long)

[Jeff Wasel]

Hi All,

Hope this post finds the list in good health!

Saw this on the Wall Street Journal's tech watch list and hadn't on Am-Info.
I've included the text, in case you can't access the site.

Holdouts in Microsoft Case Push for Tougher Penalties

http://online.wsj.com/article/0,,SB105216644662356200,00.html?mod=dartTechto
day

May be the fat lady hasn't sung after all?

Holdouts in Microsoft Case
Push for Tougher Penalties

A WALL STREET JOURNAL ONLINE NEWS ROUNDUP


WASHINGTON -- Two states that refused to settle the Microsoft Corp.
antitrust case sought tougher penalties Monday, arguing that a deal
negotiated with the Bush administration was inadequate to constrain the
software company.

Massachusetts and West Virginia urged a federal appeals court to instruct
the trial judge to impose tougher sanctions than those included in a
settlement the judge approved among Microsoft, the Justice Department and 17
other states.

 See an interactive chronology of the long-running case, and more
information at wsj.com/microsoft.

In a case that began nearly a decade ago, lawyers for the states said the
settlement was profoundly flawed and "does not fulfill even the most basic
mission of stopping all of the practices" committed by Microsoft. Courtroom
arguments before the appellate judges were to begin in November.

"The district court's remedy will not restore competition, deny Microsoft
the fruits of its illegal conduct or otherwise satisfy this [appeals]
court's remedial objectives," the states wrote.

Microsoft noted that its legal filings were due next month.

"The district court thoroughly reviewed these issues last year and issued
comprehensive rulings that represent a fair resolution of this case,"
spokesman Jim Desler said. "These rulings have been agreed to by the
Department of Justice, virtually all the states that filed suit against
Microsoft and only two states and a couple of competitor groups are pressing
forward."

The long-running court battle culminated last November when U.S. District
Judge Colleen Kollar-Kotelly accepted nearly all the settlement provisions.
She rebuffed arguments by nine states and the District of Columbia that
tougher sanctions were essential to restore competition in the computer
industry.

All the states except Massachusetts and West Virginia eventually joined in
the settlement, which gives Microsoft rivals more flexibility to offer
competing software features on computers running its flagship Windows
operating system.

"Microsoft has been found guilty of predatory practices yet allowed to
continue to crush innovation, competition and consumer choice in the
computer software industry. This conduct harms consumers and companies all
over the country," the Massachusetts attorney general, Tom Reilly, said in a
statement Monday.

The two holdout states are carrying their fight to a U.S. appeals court that
has handed Microsoft considerable victories. It overturned another judge's
order that Microsoft remove its Web browser software from Windows, and it
threw out two of the government's three antitrust claims against the
software company. It also blocked a court-ordered break-up of Microsoft.

But the same appeals court also affirmed in June 2001 that Microsoft
repeatedly, ruthlessly and illegally used its dominance in the software
industry to protect its Windows monopoly from competition. And it has
already indicated that the entire court will rule on this latest fight,
rather than the traditional panel of three judges.

Separately, Microsoft agreed to a $12.3 million settlement of a class-action
lawsuit that alleged the company violated Montana's antitrust and unfair
competition laws.

The settlement benefits consumers who purchased Microsoft's operating
system, productivity suite, spreadsheet or word-processing software between
March 28, 1996, and Aug. 31, 2002, for use in Montana.

The Redmond, Wash., software maker said Monday that it will pay the
settlement to class members as vouchers to buy any manufacturer's desktop,
laptop and tablet computers, as well as any associated software and
peripheral devices.

Similarly, Microsoft agreed to pay as much as $202 million to Florida
computer users, and in January agreed to pay up to $1.1 billion to
California computer users to settle class-action antitrust lawsuits.

Microsoft said it will donate half of any unclaimed settlement proceeds to
Montana's most needy public schools as vouchers for hardware, software, and
professional development services, as it did in the Florida case. The
company estimated that 325 schools serving more than 38,325 Montana
students -- about one-quarter of all students in the state -- will be
eligible.

Updated May 5, 2003 7:33 p.m.

Cheers,

Jeff


Jeff Wasel
Doctoral Researcher
Department of Information Systems
The London School of Economics
Fifth Floor, Tower 1
Houghton St.
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07764-944781