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  Microsoft Asks Judge To Delay Hearing

By Rajiv Chandrasekaran
Washington Post Staff Writer
Friday, May 22, 1998; Page D01

Microsoft Corp. asked a federal judge yesterday to wait seven months before convening a preliminary hearing into antitrust lawsuits filed by the Justice Department and 20 state attorneys general.

In a brief submitted to U.S. District Judge Thomas Penfield Jackson in Washington, Microsoft argued that it needs time to pore through the government's evidence, interview witnesses and prepare its defense.

Government lawyers called the request a bid to stall the case so Microsoft can sell millions of copies of its upcoming Windows 98 software before the judge decides the cases' key issue of whether the software must be changed.

Jackson plans to consider the company's request at a hearing today, the first courtroom face-off between the sides since the government lawyers filed the suits Monday.

Justice and the states want Jackson to issue a preliminary injunction that would order Microsoft to either strip its Internet browsing technology from Windows 98 or include a browser made by rival Netscape Communications Corp. The government lawyers are hoping to get a decision by June 25, the date when Windows 98-equipped computers will first be shipped to consumers.

"This case could live or die on the outcome of the preliminary injunction," said Robert Litan, a former deputy assistant attorney general at Justice who is the director of economic studies at the Brookings Institution. "It's the ballgame here."

If a preliminary injunction is issued around June 25 and requires Microsoft to carry Netscape's browser, it could bring big changes in the software market. Even if Microsoft gets the injunction overturned, which could take six months or more, the damage would already be done, legal analysts said.

On the other hand, if Justice loses the preliminary injunction but later wins the case, Microsoft would have already shipped tens of millions of copies of the unaltered Windows 98. In the middle of a product cycle, computer makers might be loath to avail themselves of some of the other options Justice is seeking, such as full freedom to develop "shell" programs that hide the Windows 98 start-up screen.

"It's to Microsoft's advantage to delay as much as possible," said Tyler A. Baker, a Justice antitrust lawyer in the Reagan administration who is now a partner in the Dallas law firm Carrington, Coleman, Sloman & Blumenthal.

Litan and others cite an antitrust case the department brought against Microsoft last year in which Jackson ordered the company to let PC makers delete the desktop icon for the Microsoft browser on Windows 95 but no major computer maker opted to because Windows 95 had been sold for two years with the icon.

In their court filing yesterday, Microsoft lawyers asked for 60 days to review the government's evidence and gather additional data and 120 days to interview witnesses. It also asked Jackson to combine the Justice Department and states' lawsuits.

"Given the breadth of the injunctive relief requested by the [department] and the states – and the severe adverse impact that such relief would have not only on Microsoft but also on other companies in the personal computer industry . . . Microsoft deserves adequate time to conduct discovery and prepare its response," the company wrote.

A Microsoft spokesman called the company's seven-month preparation period "a reasonable amount of time" in light of the government's "broad and far-reaching case."

A Justice Department lawyer said the government would oppose Microsoft's request at today's hearing. "They want to be selling Windows 99 when we finally litigate over Windows 98," the lawyer said.

© Copyright 1998 The Washington Post Company

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