DOJ opposes extension of Microsoft antitrust oversight

Objecting states don't have a legal leg to stand on, says Justice Department brief

The U.S. Department of Justice (DOJ) on Friday joined Microsoft Corp. in opposing efforts by California, New York and several other states to extend the 2002 antitrust settlement with the company, saying there is no legal basis for another five years of oversight.

In its brief, the DOJ urged U.S. District Court Judge Colleen Kollar-Kotelly to reject arguments already made by 17 states and the District of Columbia to extend major provisions of the consent decree until November 2012. On Tuesday, Microsoft had filed its own brief opposing the states' motions.

It was no surprise that federal regulators sided again with Microsoft; in late August, the DOJ said that the consent decree -- most of which was then scheduled to expire Nov. 12 -- had done its job. The latest federal filing blasted one group of states, led by New York, for an about-face, and took the other group, which is headed by California, to task for weak legal logic.

"Just two months ago, the New York group joined with the United States in concluding that the final judgments had 'achieved [their] goals'," the Justice Department brief read. "The New York movants' about-face is ... difficult to understand."

In a telephone interview more than two weeks ago, however, the head of New York's antitrust bureau denied that his state had flip-flopped. "I don't think we had a change of heart at all," said Jay Himes, the chief of the antitrust bureau within the state attorney general's office.

The federal filing attacked the reasoning of both groups. "It is difficult to determine the exact factual basis for the New York movants' extension request," continued the filing. "In a number of places, the New York movants suggest Microsoft must demonstrate why the extension would not be in the public interest. But this is not the law. [They] are not entitled to a contested modification of their judgment because they think it would be a 'benefit to the public interest.' They must, at a minimum, establish that the final judgments have failed to meet their remedial goals in some substantial way."

California and the states that joined it in demanding an extension did not escape criticism. The DOJ blasted the group's line of argument in October that Microsoft might use the dominance of its Internet Explorer browser to stymie competition from Web-based applications and services. "The final judgments do not mandate that [resellers], who are not parties in this case, install non-Microsoft Web browsers as a default," the DOJ said in its filing. "The final judgments only seek to ensure that Microsoft does not block the OEM distribution channel."

The states have until next Friday to reply to the Microsoft and DOJ briefs. Under the temporary extension agreed to last week, Kollar-Kotelly has until the end of January to decide whether to extend the decree.

Copyright © 2007 IDG Communications, Inc.

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