Feds Defend Microsoft Judge
By Michael J. Sniffen
Associated Press Writer
Friday, Jan. 12, 2001; 12:30 p.m. EST WASHINGTON The Justice Department told a federal appeals court Friday that the judge who ordered the breakup of Microsoft was not biased as the giant computer software company has alleged.
Reviewing several remarks by U.S. District Judge Thomas Penfield Jackson that the company has cited, the department's antitrust division said the comments "demonstrate neither bias nor the appearance of bias."
"The remarks cited by Microsoft provide no reason to doubt Judge Jackson's impartiality," the government said in a 150-page brief filed with the U.S. Circuit Court of Appeals for the District of Columbia.
In an interview with The New Yorker magazine, published Jan. 8, Jackson had compared Microsoft founder Bill Gates to Napoleon and said Microsoft executives behave like children.
"I think he has a Napoleonic concept of himself and his company, an arrogance that derives from power and unalloyed success, with no leavening hard experience, no reverses," Jackson said.
That was months after Microsoft's lawyers went to the federal appellate court here and argued that Jackson had compromised "the appearance of impartiality" in his handling of the case.
The federal judge ordered Microsoft broken into two parts last June 7.
Microsoft is appealing Jackson's decision.
Apart from the arguments about Jackson's judicial demeanor, Microsoft also contended the judge incorrectly assessed the facts of the case, and that the company did not engage in anticompetitive behavior. The government disagreed with this, saying the software giant used its overwhelming market share to shut out rivals.
"(Microsoft) deliberately embarked on a multifaceted campaign of anti-competitive conduct to protect its operating system monopoly," the government said, citing efforts against Netscape Corp. and Sun Microsystems.
The government also went to the heart of the antitrust case, Microsoft's decision to bundle its Windows operating system and Internet Explorer software. The Justice brief reiterated its argument that they are two separate products bundled together, forcing customers who want Windows to also have the company's Internet browser.
Microsoft has argued that the two products have become intertwined into one, in order to provide more functions to users, and not to keep possible competitors out of the browser market.
Microsoft spokesman Vivek Varma said in an interview that the company believes it will be vindicated.
"We continue to believe that Microsoft's decision to integrate browser and operating system will be found to be procompetitive and beneficial to consumers," Varma said.
He also cited the merger of America Online and Time Warner as evidence that Microsoft isn't a sole monopoly power.
The merger, he said, is "simply the latest example of the last three years of this case that the fierce competition that Microsoft faces in the high-tech industry."
In the magazine interview, Jackson also said that Microsoft's lead attorney, William Neukom, is "not very smart, or at least I don't think he has any subtlety." Neukom, he said, should have advised the company that '"the time has come for us to be flexible.'"
In the appeal filed late last November, Microsoft said interviews Jackson granted to news organizations constituted evidence that he is biased against the company. Jackson had given a newspaper interview rare for a federal judge immediately after ordering Microsoft's breakup in which he said he had little choice but to accept the government's breakup proposal.
"By repeatedly commenting on the merits of the case in the press," the company's brief argued, "the district judge has cast himself in the public's eye as a participant in the controversy, thereby compromising the appearance of impartiality, if not demonstrating actual bias against Microsoft."
Whereas Microsoft used Jackson's quotes to reporters as a cornerstone of its brief calling for the appeals court to overturn the breakup decision, the government used other quotes including ones where Jackson said he "held no ill will against the company or its co-founder and chairman, Mr. (Bill) Gates." to demonstrate his evenhandedness.
The Justice Department had sought to have the appeal sent directly to the Supreme Court, but the high court turned that plea aside in late September, remanding the case to the appellate court.
"This is the beginning of a new chapter in this case," Gates said at the time of Jackson's ruling. He called the decision inconsistent with past court decisions and with the realities of the marketplace.
Jackson's ruling forbade the company from entering into "exclusive dealing" that would restrict the development of competitors' products.
"Microsoft, as it is presently organized and led, is unwilling to accept the notion that it broke the law or accede to an order amending its conduct," wrote Jackson at the time, explaining why he believed the breakup was necessary.
"Microsoft has proved untrustworthy in the past," Jackson said, citing its failure to comply with a court ruling earlier in the 1990s that preceded the antitrust case.
The judge had ruled April 3 that Microsoft violated federal antitrust law by using illegal methods to protect a monopoly in computer operating systems. He found the company tried illegally to expand its dominance into the market for Internet browsers.
Also Friday, a federal judge in Baltimore ruled that plaintiffs in 38 class-action lawsuits couldn't sue Microsoft for damages since their Windows software was preinstalled on personal computers or acquired through resellers, rather than from Microsoft. The suits were individual efforts against Microsoft growing out of the antitrust decision.
Shares of Microsoft were trading down $1.75 to $53.25 on the Nasdaq Stock Market.
On the Net:
Department of Justice: http://www.usdoj.gov
U.S. Court of Appeals for the District of Columbia: http://www.cadc.uscourts.gov
© Copyright 2001 The Associated Press