[Am-info] AG's fight still draws interest

[Erick Andrews]

http://www.boston.com/dailyglobe2/195/business/AG_s_fight_still_draws_interest+.shtml

===================================================
AG's fight still draws interest

Reilly against Microsoft appeals to other parties

By Peter J. Howe, Globe Staff, 7/14/2003

Massachusetts Attorney General Thomas F. Reilly will be back in
court this week as the only state prosecutor in the United States
still contesting the settlement of the five-year-old government
antitrust lawsuit against Microsoft Corp.

Reilly insists he feels not the least bit lonely or uncertain,
despite criticism from Microsoft and its supporters.  As Reilly
sees it, last November's settlement is riddled with loopholes and
does far too little to curb Microsoft's "ruthless anticompetitive
behavior."

His stubbornness is applauded by Microsoft foes and even some of
the 17 other state prosecutors who have dropped out of the
Microsoft case to put their energies elsewhere.

"It's pretty simple, at least from my perspective," Reilly, who is
often mentioned as a 2006 gubernatorial candidate, said in an
interview last week.  "I believe in competition.  I believe in
free enterprise.  I see competition as the cornerstone of our
economy and our democracy.  I believe that to my core.  It's no
mystery."

Reilly, a former top prosecutor in Middlesex County who made his
name convicting high-profile killers rather than pursuing consumer
crusades, has surprised many with his dogged and potentially
quixotic pursuit of Microsoft.  But he said that deciding to keep
fighting "was not a close call."

"These were some of the most egregious violations in this
country," he said.  "If it's worth fighting for, it's worth
fighting for to the end.  This is the right thing to do.  There's
no doubt there."

On Wednesday, Reilly is set to file his last round of briefs with
the US Court of Appeals for the District of Columbia, with oral
arguments set for Nov.  4. Reilly is challenging, on a host of
technical issues, the settlement approved by US District Judge
Colleen Kollar-Kotelly.

Among the issues he cites is whether the settlement does enough to
block Microsoft from commingling its monopoly Windows
personal-computer operating system with Microsoft's Internet
Explorer Web browser program and whether it goes far enough in
making Microsoft open up secret computer code to help rivals write
programs running on Windows.

Industry watchers say it is hazardous to speculate on Reilly's
chances.  But John Kwoka, a Northeastern University economics
professor and a research fellow of the American Antitrust
Institute, said:  "He is certainly raising the right issues.  I
think it is a very good thing for the antitrust process, as well
as the people of Massachusetts, that someone is still raising
questions."

Kwoka, who has spoken with several other state attorneys general
about the case, said:  "Many just decided to throw in the towel at
some point, having made a calculation about where their resources
in 2003 can best be put.  It's not because all of them were
satisfied with the settlement.  I know for a fact some of them
were not."

Iowa Attorney General Tom Miller was one of the leaders of the
states' antitrust case filed in 1998, but last year he chose to
accept the settlement and focus on enforcing it.  "I think
Attorney General Reilly is performing a very important public
service to get this case before the circuit court, so they have a
chance to review the remedy," Miller said.  "There are some live
issues that can still be resolved."  Also enthusiastic about
Reilly's review is Jason M. Mahler, general counsel of the
Computer & Communications Industry Association, whose members
include Microsoft foes like Oracle Corp.  and Sun Microsystems.

"Beyond the actual details of the case and the legal points and
legal matters that are still at issue, we think it's vitally
important for antitrust enforcement generally to have this carried
through the court of appeals so people have confidence" in the
ultimate outcome, Mahler said.  "This is the most important
antitrust case in a generation."

Ken Wasch, president of the Software & Information Industry
Association, was even more effusive.  "Tom Reilly is a hero to the
software industry," Wasch said.  "Antitrust enforcement is a game
of endurance, and the settlement has had absolutely zero effect on
the competitive landscape of the industry."

Reilly has his critics, of course.

"These issues have been looked at in a very thorough and
exhaustive review by the district court, and these additional
sanctions [Reilly seeks] would harm not just Microsoft, but the
software industry and the economy as well," said Microsoft
spokesman Jim Desler.

Desler had no comment on whether Microsoft is seeking to come to a
truce with Reilly.  "We have made an effort throughout the country
in terms of building positive relationships with state
governments, and our focus is on full compliance with the court's
final order," Desler said.

Bob Levy -- a senior fellow with the Cato Institute, a free-market
think tank that opposes most antitrust laws -- said:  "We don't
think very highly of Reilly's continuing pursuit of this
legislation, but then we think it's something he never should have
started in the first place, and neither should any of the other
states or the federal government."

Cato contends that having multiple states pursue federal antitrust
litigation, along with the Justice Department, amounts to unfair
"multiple jeopardy for defendants" and that the antitrust laws are
nebulous and fluid.

Reilly said that finding funds to pursue Microsoft is "not an
issue" in Massachusetts, with probably 95 percent of the legal
work already done.  From here, "it's staff time," he said, with
assistant attorney general Glenn Kaplan, who now oversees
insurance regulation, able to handle what remains to be done on
the Microsoft case.

In November, Steven R. Kuney, an appellate litigation specialist
with the Washington law firm Williams & Connolly LLP, will handle
courtroom arguments on behalf of Massachusetts.

In contrast to California, which is home to several large
Microsoft competitors, Massachusetts has no similarly sized
Microsoft rivals pushing Reilly to sustain the case.  The state's
high-tech community is generally divided or has stayed out of the
fight.

Of Reilly's reelection campaign contributions last year --
overwhelmingly from lawyers and executives of regulated utilities
and healthcare companies -- barely a half-dozen $500 donations
came from people with identifiable high-tech ties, including
executives from Concerto Software, Intel Corp., Painted Word
Computers, and RiverDelta Networks.

Despite the fact there is no obvious political upside, Miller said
Reilly's continued pursuit of Microsoft "doesn't surprise me a
bit."

"Tom is someone who feels strongly about issues, tends to see them
in terms of right and wrong, and has the courage of his
convictions," he said.
===================================================

-- 
Erick Andrews