May 15, 2002 (Computerworld) --
WASHINGTON -- An inquisitive U.S. District Court Judge Colleen Kollar-Kotelly challenged attorneys in the Microsoft Corp. antitrust case today to defend their positions on a number of legal issues, while revealing little on how she might ultimately rule. A key issue before Kollar-Kotelly is whether last June's Court of Appeals finding that Microsoft had illegally maintained its monopoly in operating systems calls for a broad remedy that also applies to handheld operating systems, set-top boxes, server operating systems and Web services. "What is really at issue," said Kollar-Kotelly, is whether the nonsettling states can identify technologies similar to Java and Netscape Communications Corp.'s Navigator, nascent technologies "such that they are now in need of protection from Microsoft." The judge made it clear that she hasn't decided on the issue, but she did hint that the argument made by the nonsettling states for a remedy covering handhelds and set-top boxes may be weak. She said the proposal "is less clear" in those areas than for server operating systems and handhelds. One problem, said Kollar-Kotelly, is showing whether Microsoft's anticompetitive behavior can be considered ongoing, "same or similar conduct" without bringing in new allegations of wrongdoing. The judge acknowledged that it's not clear to her how she should consider this. Kollar-Kotelly, in her questioning of the attorneys, gave the clear impression of someone wrestling with legal issues raised in this case. At the conclusion of one set of arguments over whether a broad remedy is needed, she told the attorneys: "Let me assure counsel that I've made no decision in this area." States' attorney Steven Kuney argued that a broader remedy is indeed called for and said that areas such as server operating systems and Web services, to some extent, are covered in the settlement proposal reached between Microsoft, the Bush administration and nine of the 18 states originally involved in the case. Kuney also argued that prior Supreme Court rulings point to remedies that go beyond addressing specific anticompetitive acts found by the appeals court, and in the case of Microsoft, they can be used to address any platform threat. For example, in the area of handhelds, Kuney said the "ultimate battle ... is a battle for the interest and loyalty of software developers." If thousands of developers write applications for handhelds, citing the Palm operating system, that's a threat to Microsoft's platform market, argued Kuney. But Kollar-Kotelly questioned where that argument might lead. "Is there any new technology out there that isn't going to fit those definitions?" she asked. Kuney said Microsoft determines the platform threats. "They spot the technologies that matter before us," he said. Microsoft attorney Dan Webb, citing the same Supreme Court rulings that Kuney pointed to, said prior rulings were clear that courts should limit antitrust remedies to specific wrongs. "You do not find the courts going into brand-new markets," said Webb. Based on that argument, the judge asked at one point, "What is the rationale" for not including server operating systems within the scope of the case? Webb said the only reason Microsoft agreed to any terms in the settlement affecting servers was for the sake of expediency. "That clearly is a provision that we agreed [with] to get this case settled." Both sides will appear in court tomorrow and Friday to continue arguments on a range of legal issues. Closing arguments have been set for June 19. Testimony in the remedy phase concluded last Friday. The hearings were brought about by the nine states that refused to back the Bush administration settlement with the company. The settlement is also awaiting action by the judge. The dissenting states -- California, Connecticut, Florida, Kansas, Iowa, Massachusetts, Minnesota, Utah and West Virginia as well as the District of Columbia -- are seeking tougher remedies than those called for in the U.S. Department of Justice deal. The holdouts' proposals include a requirement that Microsoft create a thin-client version of Windows, stripped of most of its applications, as well as the porting of Office to other operating systems, such as Linux.
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