Appeals court liberates Windows 98 from injunction

A US appeals court has excluded Windows 98 from a lower court order that bars Microsoft from forcing computer makers to offer Internet Explorer with its Windows 95 operating system. While the court will continue to review an appeal of the December preliminary injunction, today's decision frees Microsoft to ship its latest operating system to PC manufacturers tomorrow as scheduled. Windows 98 is scheduled to be released to the public on June 25.

A US appeals court has excluded Windows 98 from a lower court order that bars Microsoft from forcing computer makers to offer Internet Explorer with its Windows 95 operating system.

While the court will continue to review an appeal of the December preliminary injunction, today's decision frees Microsoft to ship its latest operating system to PC manufacturers tomorrow as scheduled. Windows 98 is scheduled to be released to the public on June 25.

"The United States presented no evidence suggesting that Windows 98 was not an 'integrated product' and thus exempt from the prohibitions" in the 1995 consent order that barred Microsoft from tying the licensing of Windows with licensing of another product but allow Microsoft to add features to its operating system, the US Court of Appeals for the District of Columbia said in its decision.

A spokesman for the US Department of Justice (DOJ) minimised the significance of the ruling.

"This is a narrow decision on the consent decree case," said Michael Gordon. "Of course, our investigation into Microsoft is continuing."

The DOJ and a group of state attorneys general have reportedly been planning to file either a combined antitrust lawsuit or separate lawsuits on Thursday or Friday in an attempt to preempt Microsoft from offering its browser integrated into Windows 98.

Earlier in the day, Sun Microsystems asked another federal court to stop Microsoft from shipping Windows 98 with Java code that is incompatible with Sun's version of Java.

Microsoft asked the federal appeals court last week to stay portions of the preliminary injunction as it relates to Windows 98 pending Microsoft's appeal of the injunction.

The December 11 District Court injunction orders Microsoft to stop the practice of licensing the use of its "operating system software (including Windows 95 or any successor version thereof) on the condition, express or implied, that the licensee also license and preinstall any Microsoft Internet browser software..."

The DOJ contends that Microsoft realised that the preliminary injunction covers Windows 98 and criticised the company last week for waiting to ask for a clarification on whether Windows 98 is covered under the injunction until right before the operating system is due to be released.

Meanwhile, a Microsoft spokesman was unabashedly pleased with the ruling. "We are gratified with the decision," said Jim Cullinan. "We see this as a victory for customers and consumers that they will be able to enjoy the full benefits of this great product."

The preliminary injunction was issued after the DOJ took Microsoft to court last October claiming that the company was violating a 1995 antitrust consent decree by forcing PC makers to license Internet Explorer along with Windows 95.

Before the court could rule on a DOJ contempt-of-court request, Microsoft and the DOJ settled out of court. Microsoft agreed to offer Windows 95 versions with the Internet Explorer icon removed. However, Microsoft persisted in appealing the preliminary injunction as well as the appointment of an adviser to the court.

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