MS/DOJ: DOJ mulls remedies

The US Department of Justice is currently in the process of mulling over several potential remedies it will propose in the event it wins its antitrust case against Microsoft -- a prospect that seems more likely with each passing Microsoft courtroom blunder. Although no decisions have been made, two proposals -- breaking the software giant into two or three separate companies and forcing it to license its Windows code -- are being considered alongside less drastic remedies.

The US Department of Justice is currently in the process of mulling over several potential remedies it will propose in the event it wins its antitrust case against Microsoft -- a prospect that seems more likely with each passing Microsoft courtroom blunder.

A source familiar with prosecutors' thinking confirmed reports that in recent weeks, Department of Justice officials have stepped up talks about potential remedies they will propose should they prove their case in the eyes of US District Judge Thomas Penfield Jackson.

Although no decisions have been made, two proposals -- breaking the software giant into two or three separate companies and forcing it to license its Windows code -- are being considered in addition to a series of less drastic remedies.

One legal antitrust expert said while it is understandable that the government would not want to discuss remedies with the trial still proceeding -- Microsoft is in the midst of presenting its defense -- it also stands to reason that prosecutors are preparing for the remedy phase of the trial, should they prevail.

"There is a long tendency, going back through the history of Sherman [Antitrust] Act cases, for the remedy to be too much of an afterthought," said William Kovacic, a law professor at the George Mason School of Law, in Washington. "The tendency is to think that the crucial battle is to win on liability, to show there's been a violation. The danger in doing it that way is you don't devote nearly enough attention to deciding what it is you want to accomplish when the judge says you win."

"It could be viewed as an arrogant display of confidence in their case," Kovacic continued. "But especially in this industry, and in this kind of case, you'd better have a destination clearly in mind before you start the journey, instead of driving along reading a map and saying, 'Oh, now where do we want to go?'"

Another potential fix, should Microsoft lose the case, would be to order the company to end any predatory business practices defined by the government -- such as its contracts with ISPs that are viewed by many as exclusionary. However, that was the intent of the 1995 consent decree Microsoft signed with the Department of Justice, but that pact has been viewed as largely ineffective.

Department of Justice officials had no comment.

If Jackson does rule against Microsoft, the government is expected have its recommended remedies in hand then for Jackson to consider. But Microsoft is expected to appeal an unfavorable ruling immediately, a move that likely would postpone any decision on remedies.

"The judge is likely to tell Microsoft that they can appeal the entire package [a verdict and remedies]," Kovacic said. "There will be no remedies put in place during the appellate process."

One industry organisation, the Association for Competitive Technology (ACT), argued that it is far too early for the Department of Justice to be discussing what it will do if it wins the trial.

ACT -- which has allied itself with Microsoft throughout the company's fight with the government, and counts Microsoft among its hundreds of dues-paying members -- on Tuesday released a survey of 408 executives in the IT industry. The survey's message was that the government should keep its hands off of the industry.

According to the survey -- performed one month ago by for ACT by the Washington firm Mason-Dixon Political/Media Research -- 63% opposed a Microsoft breakup; 67% opposed forcing Microsoft to open up Windows to licensing; and 72% opposed the forced inclusion of competing companies' software in Windows.

"People like standards, and we've chosen Windows to be our standard," said Ted Johnson, executive Vice President of Visio and an ACT board member. "It's a stable platform on which we all rely. It is not really a surprise to me that Unix never really took off."

Microsoft Corp., in Redmond, Wash., can be reached at www.microsoft.com. The U.S. Department of Justice, in Washington, can be reached at www.usdoj.gov. The Association for Competitive Technology can be reached at www.competitivetechnology.org. Visio Corp., in Seattle, can be reached at www.visio.com.

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