Appeals court judges question case against MS

Both sides in the Microsoft antitrust case have faced a stream of blistering questions from a panel of US Court of Appeals judges - but the attorney representing the US DOJ clearly copped it worse.

          Both sides in the Microsoft antitrust case have faced a steady stream of blistering questions from a panel of seven US Court of Appeals judges. But the attorney representing the US Department of Justice (DOJ) clearly received the worse of it, with several judges bluntly questioning the foundation of the government's case.

          On the first of two days of oral arguments in front of the appeals court for the Washington circuit, Jeffrey Minear, an attorney from the Office of the Solicitor General who's handling the DOJ's defense of a breakup order against Microsoft, began his comments with a sweeping attack on the software vendor. But Minear was quickly forced to argue with some of the judges over whether Microsoft used anticompetitive measures against Web browser rival Netscape Communications.

          In direct and caustic questioning, Chief Judge Harry Edwards said he doubted the validity of the government's theory that Microsoft exhibited monopolistic behavior by attacking Netscape from a business standpoint. And he asserted that Netscape would simply have become another monopoly if it won out in the browser market against Microsoft.

          Netscape's browser represented a middleware threat that could have made the Windows operating system "relatively insignificant" if software developers began writing applications directly to the browser, Edwards said.

          "That was the threat that Microsoft contemplated -- that middleware would virtually wipe out anything of great import [that Windows offers to users]," he said.

          Edwards added that Netscape, in combination with Sun Microsystems, would have replaced Windows with a monopoly technology of their own making. "That's what this case is ultimately about: whether or not the Microsoft monopoly -- [or] the alleged Microsoft monopoly -- should be replaced by the Netscape/Sun-combination middleware monopoly," he said.

          Minear said he disagreed and claimed that the antitrust case against Microsoft is "all about allowing the competitive process to determine who will be the winner in the market." That prompted an exchange in which Edwards contended that the winning company "will be a monopoly" either way and Minear replied that the court should let the market determine that in a fair and open process.

          Microsoft attorney Richard Urowsky also faced his share of tough questions, but none seemed as pointed as the ones posed to Minear. And Urowsky may have scored a significant point with his contention that Netscape was never shut out of distributing its Web browser by Microsoft's bundling of Windows and Internet Explorer.

          Urowsky illustrated that argument by claiming that 60 million people downloaded Netscape Navigator in 1998. Commenting on Urowsky's claim, appeals court judge Stephen Williams said, "I took seriously the proposition that [the need to download Netscape's browser] was a big barrier. But 60 million [people] downloaded it."

          Microsoft and the DOJ are facing off over the merits of US District Court Judge Thomas Penfield Jackson's ruling last year that the vendor violated antitrust law and should be split into two companies -- a move that, if upheld during the appeals process, would separate Microsoft's operating systems from its applications.

          Monday's oral-arguments session revolved around two key issues: whether Microsoft illegally tied its browser to Windows and whether the company illegally maintained its desktop computing monopoly. Tomorrow, the appeals court plans to consider Jackson's proposed remedy as well as his conduct during the trial and public comments he has made since it ended last June.

          Jackson wrote in his breakup order that the goal of the ruling was to restore competition in the software industry. Without a breakup of the company, he said, Microsoft "may yet do to other markets what it has already done in the PC operating system and browser markets."

          Microsoft has steadfastly denied that it engaged in anticompetitive behavior, and the company charged as part of its appeal that Jackson "demonstrate[d] an animus toward Microsoft so strong that it inevitably infected his rulings".

          But the DOJ and a group of state governments that are involved in the case urged the appeals court in their written filings to uphold Jackson's breakup order, arguing that Microsoft would still have the "incentive and ability" to engage in anticompetitive conduct if it isn't split in two.

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