News

Judge Upholds Antitrust Settlement Agreement

• By Scott Bekker
• 11/01/2002

Judge Kollar-Kotelly handled two parallel cases, consideration of the settlement agreement and a separate case brought by the parties that were part of the antitrust action but didn't sign the settlement -- nine states and the District of Columbia.

After eight weeks of hearings on the non-settling states harsher remedy proposals and her request that the parties try to come a mutually agreeable settlement, the judge in the end decided that the original, and much criticized remedy proposal did the job.

The judge dismissed most of the arguments the non-settling states presented in court. In an executive summary of the 300-plus-page opinion prepared "given the demonstrated public interest in this case," Kollar-Kotelly wrote:
"It appears that these types of remedial provisions seek to convert certain legitimate aspects of Microsoft's business model and/or product design into a model which resembles that of other industry participants simply for the sake of changing the status quo. Certain of Microsoft's competitors appear to be those who most desire these provisions, and concomitantly, are the likely beneficiaries of these provisions, while other competitors in the relevant market would not necessarily benefit."

While that statement sounds like it could have been ripped straight out of the Microsoft legal playbook, Kollar-Kotelly warned that Microsoft needed to abide by the court-approved settlement.

"Let it not be said of Microsoft that a 'prince never lacks legitimate reasons to break his promise,' for this Court will exercise its full panoply of powers to ensure that the letter and spirit of this remedial decree are carried out," Kollar-Kotelly wrote in a quote of Machiavelli.

The judge reserved the right to extend the five year agreement by two years.

In a statement, a Microsoft spokesperson said, "We are pleased that the court has conditionally approved the settlement we reached with the federal government and the nine states. The settlement is a tough, but fair, compromise."