Microsoft case in political limbo

Like the rest of the US, Microsoft is in political limbo while the Florida recount seeks to decide which presidential candidate has carried the state - and the country.

          Like the rest of the US, Microsoft is in political limbo while the Florida recount seeks to decide which presidential candidate has carried the state - and the country.

          The futures of two Republicans viewed as friends by the antitrust-embattled software giant -- presidential candidate George W. Bush and U.S. Sen. Slade Gorton of Washington -- hung in the balance as on Wednesday.

          And, ironically, a longtime Microsoft foe, consumer advocate Ralph Nader, could end up helping Bush reach the White House.

          Early Wednesday morning, Bush was prematurely declared the victor over Democratic Vice President Al Gore before the state of Florida and its 25 electoral votes were taken out of the Texas governor's column. With the margin of difference less than two thousand votes, Florida is recounting the ballots.

          Many observers have said a Bush administration would have a dim view of the antitrust case brought by the US Department of Justice against Microsoft because Bush is viewed as more of a friend of corporate America than are Gore and the Clinton administration. Bush has not commented directly on the Microsoft trial other than to say he prefers "innovation over litigation" -- echoing Microsoft's framing of the antitrust issues.

          However, if Microsoft is counting on a friendlier Bush administration to help it out of the antitrust mess, two factors indicate that the software giant may be out of luck.

          Regardless of who moves into the White House, any settlement would have to get a thumbs-up from the Justice Department's co-plaintiffs, the state attorneys general who joined the lawsuit. Many of the states have been strident in their calls to break up Microsoft and are unlikely to sign on to a settlement at this stage, said one legal expert.

          "The states vigorously oppose a settlement, and they could reject any settlement and pursue [the case] through the appellate court," said Hillard Sterling, an antitrust attorney at the Chicago firm of Gordon & Glickson PC. "It must be agreed to by all the plaintiffs, including those who have proven to be very unwilling to agree to anything short of a breakup."

          Also, potential Bush appointees to the Justice Department would have to be approved by the Senate Judiciary Committee. In addition to being a very time-consuming process, the confirmation would go before that committee's chairman, U.S. Sen. Orrin Hatch, R-Utah, who has been highly critical of Microsoft's business practices and who has chaired hearings on high-tech competition. Novell, a chief rival of Microsoft, is based in Hatch's home state.

          "The game is just too far along for a settlement to re-emerge as a viable alternative," Sterling said.

          Gorton, dubbed "the senator from Microsoft" because of his staunch backing of the home-state corporation, was locked in the closest U.S. Senate election of the night. Wednesday morning, polls showed him ahead of Democrat Maria Cantwell, a former executive from RealNetworks, who funded the bulk of her campaign with almost $10 million of her own money. Gorton declared victory late Tuesday -- by fewer than 5,000 votes.

          The results of that election may not be known for two weeks, as election officials count more than 1 million absentee ballots.

          Microsoft Chairman Bill Gates has hosted fundraisers for Gorton, who made the Justice Department case against Microsoft a key issue in his campaign. Gorton accused Cantwell of waffling on whether Microsoft should be split in two and bragged that he had turned the Senate against Hatch.

          If Gore ends up losing the election, many Democrats no doubt will blame Ralph Nader, the Green Party candidate, for siphoning votes from the vice president. Nader garnered 2 percent of the Florida vote and made strong showings in a few other states, including a 5 percent showing in Oregon -- where Bush led by 2 percentage points over Gore on Wednesday, with 84 percent of the vote counted.

          Nader has been a thorn in the side of Microsoft, pulling no punches in his highly critical comments of the Redmond, Wash. company's business practices.

          While it may come too late to be of any benefit to Microsoft, Sterling said a Bush-led Justice Department likely will slow "the aggressive re-emergence of antitrust law enforcement, particularly in the high-tech sector."

          "A Bush-driven government will look at these cases with great skepticism before authorizing any sort of suits," Sterling said.

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