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A Game of Judicial Roulette
By David Segal Dumb luck is about to play a pivotal role in the Microsoft Corp. antitrust case. Even as arguments continue in the trial phase, a handful of clerks will soon gather in a fifth-floor room of the Court of Appeals for the D.C. Circuit and toss the names of the court's 12 judges into a blue bucket. Drawing three names at a time, the clerks will create a series of three-judge panels, which a computer will later randomly assign to upcoming cases. "We try to get it as random as possible," said Marilyn Sargent, the court's chief deputy. This judicial lotto could have enormous, if unpredictable, implications for both sides in the Microsoft trial because Judge Thomas Penfield Jackson's verdict is certain to be appealed. But with Republican appointees on the appeals court only slightly outnumbering Democratic appointees, the winner of this high-stakes game of blue-bucket bingo is anybody's guess. Party affiliation is a reliable predictor of how the judges would rule in the Microsoft case, attorneys say. The Republican appointees, they said, are likely to take a dim view of efforts to restrain a dominant competitor. The Democratic judges could push for greater intervention and might impose tough remedies on the company. "Party affiliation on this topic is destiny," said one antitrust expert. Even if the matter ends up in the Supreme Court, as seems probable, the appeals court phase is crucial. "There's an ingredient of momentum in all this," said William Kovacic, a professor at George Washington University Law School. "You want to be able to say: 'Here are learned judicial officers of the court who agree with us. We're not simply singing our own tune.' " Some courtroom watchers have speculated that Microsoft officials are pinning their hopes on the appeals panel, betting that Judge Jackson, who sometimes appears openly skeptical of their case, will rule against the company. Microsoft has already won a few key procedural victories on appeal, including a ruling that tossed out a preliminary injunction imposed by Jackson. Still, Microsoft officials are fighting hard and ceding nothing to Justice's side, in part because a tightly reasoned ruling by Jackson is certain to carry huge weight with appeals judges. There is also a chance that the case will head straight to the Supreme Court. The Justice Department has the power to request what amounts to a "Go directly to the Supremes" ticket from Judge Jackson, arguing that the damage Microsoft is doing to the market and rivals needs to be stopped as soon as possible. Justice officials are rarely granted such requests, though they asked for and received one when they sought approval of the 1982 consent decree that broke up American Telephone & Telegraph Co. Such a fast-track petition would need approval from both Jackson and the Supreme Court. Justice officials won't say whether they hope to bypass the appeals court, but they might be eager to avoid a bench that has handed them several setbacks in this case. As it happens, there are seven judges on the bench appointed by Republican administrations and five appointed by Democratic administrations. But one of the Republican-appointed judges, Laurence H. Silberman, has recused himself from the Microsoft matter for personal reasons. That leaves a 6-to-5 split, though there is a further wrinkle. Another Republican appointee, James L. Buckley, is on senior status, a form of semiretirement allowing him a reduced workload. If Buckley doesn't get onto the three-judge panel that reviews the Microsoft case, he won't be allowed to review the matter if either side appeals the panel's findings to the full court, a near inevitability. And if the court ultimately deadlocks on a 5-to-5 vote, then the opinion of the three-judge panel automatically becomes the court's majority opinion. Consequently, much of this highly scripted and carefully planned case could boil down to whether one side is fortunate enough to win a 2-1 or even a 3-0 majority on the three-judge panel. One possible sign of good luck for Microsoft: The computer at the appeals court that assigns panels to cases runs on the company's Windows operating system. Jackson's ruling will hold considerable sway on appeal, experts said, because higher-court judges typically don't contest the facts of a case as presented by a lower court. Nonetheless, the appeals court could reverse Jackson without quibbling with his fact-finding, either by concluding that he applied the wrong law or misapplied the right law. It's happened before in large antitrust suits, most notably in Berkey Photo Inc. v. Eastman Kodak Co., a case rife with similarities to the Microsoft trial. A jury awarded Berkey nearly $100 million after it accused Kodak of exploiting its dominance in the photo film market to crush rival makers of Instamatic cameras. Berkey argued that Kodak introduced film that worked only in Kodak cameras and refused to alert competitors to new configurations, severely hobbling other players. But in 1979, the 2nd Circuit Court of Appeals whittled the award to a relatively anemic $1 million and backed it up with a powerfully pro-defendent opinion. The court ruled that forcing Kodak to disclose details about upcoming products to competitors was an unmanageable idea, a clear signal that courts would not require dominant companies to pull their punches. A key member of Kodak's team of attorneys: John Warden, an up-and-comer at New York's Sullivan & Cromwell, now a lead trial counsel for Microsoft. Justice can also point to its share of appellate triumphs, most importantly, an attempted monopolization case against American Airlines. In 1982, former company president Robert L. Crandall was tape-recorded offering to increase prices if a competitor did. "Raise your goddamn fares 20 percent and I'll raise mine the next morning," he told Howard Putnam, president of now-defunct Braniff Inc., who was secretly recording the profanity-laden conversation. "You'll make more money and I will, too," Crandall said. Putnam declined the offer and promptly turned in Crandall. After losing in the lower court, Justice convinced the 5th Circuit in 1984 that Crandall's offer to fix prices was illegal, even though the offer was declined. That's a key decision, because much of the government's case against Microsoft hinges on allegations that the company proposed dividing markets with rivals such as Apple Corp. -- offers that were rebuffed. As it did in the American Airlines matter, Justice is arguing that such offers are dangerous enough in themselves to constitute violations of antitrust laws. Microsoft might be heartened, however, by the mild punishment meted out to American -- a settlement with Justice promising that the company wouldn't again ask competitors to collude. One of the Justice attorneys on the American case, by the way, was Charles "Rick" Rule, now a legal consultant to Microsoft. "Crandall's offer was a naked invitation to eliminate competition," Rule said in a recent interview. "I can tell you that the meetings in the Microsoft case bear no resemblance" to the American Airlines suit, he said.
Up for the job Carter/Clinton appointees: * Harry T. Edwards * Patricia M. Wald * Merrick B. Garland * David S. Tatel * Judith W. Rogers Reagan/Bush appointees:** * Stephen F. Williams * Douglas H. Ginsburg * David B. Sentelle * James L. Buckley * A. Raymond Randolph * Karen LeCraft Henderson **Laurence H. Silberman is recused for this case. © Copyright The Washington Post Company |
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