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Microsoft fires back at AOL

By Joe Wilcox, CNet, 25 January, 2002 07:31

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Microsoft, AOL, Competition, Antitrust

NEWS
Microsoft's antitrust woes are generating enough legal briefs to level several Northwestern forests. Late on Wednesday, the software maker filed a brief with the U.S. District Court for the District of Columbia Circuit alleging that rival AOL Time Warner is not supplying information subpoenaed as part of a discovery process for an 11 March hearing in the ongoing antitrust case against Microsoft. The hearing will involve debate over potential penalties against Microsoft. Nine states and the District of Columbia have proposed forcing Microsoft to open up the source code to its Internet Explorer Web browser, among other penalties. Later on Thursday, the American Antitrust Institute (AAI) is expected to file papers alleging that the Justice Department and Microsoft failed to properly disclose all communications during settlement negotiations as required by the Tunney Act. The Nixon-era statute sets up rules for reviewing federal antitrust settlements to ensure, among other things, that backroom political deals did not influence the process. Microsoft, the Department of Justice and nine of 18 states agreed to the settlement in November. The AAI, based in Washington, describes itself as an independent nonprofit organisation aimed at promoting competition through education, research and advocacy. It supports the proposals of nine states calling on District Judge Colleen Kollar-Kotelly for stiffer sanctions against Microsoft for violating antitrust law in preserving its monopoly in personal computer operating systems. The AAI said 45 organizations contribute to its funding, including software maker Oracle, a Microsoft competitor. Oracle funding constitutes less than 10 percent of the organisation's budget, according to an AAI representative. Microsoft's Wednesday filing fires a hefty salvo at AOL, alleging that the media giant refused to disclose subpoenaed information, while lobbying the nine litigating states on developing a proposed remedy. "We filed this motion because AOL repeatedly refused to cooperate, even though the court instructed everyone to do so," said Microsoft spokesman Jim Desler. "AOL can't have it both ways. Their uncooperative attitude on document production stands in stark contrast to their active, behind-the-scenes involvement with the non-settling states." Microsoft also alleges that AOL submitted to the nine non-settling states a 39-page "preferred remedy." "AOL's proposal bears a striking resemblance to the requested relief that the non-settling States ultimately filed with the Court on December 7, 2001," the brief charges. AOL spokesman John Buckley said, "We're not going to dignify this with a response." Several deadlines loom in the case. On Friday, Microsoft and nine states opposing the settlement are due to identify expert witnesses and provide the court with accompanying materials supporting their testimony. Monday marks the end of a 60-day public comment period on the November settlement cut between Microsoft, the Justice Department and nine states. Depositions, which Microsoft has asked Kollar-Kotelly to close to the public, begin on 1 February and would include the media. She could rule on the request at any time. Adding to Microsoft's legal burden is a new challenge issued Monday, when AOL's Netscape division filed suit in federal court seeking damages for Microsoft's anti-competitive behavior during the browser wars of the late 1990s. Netscape also is asking for an injunction that could compel Microsoft to sell a stripped-down version of Windows without the Web browser, media player and other "middleware" components. "It's going to be raining paper," said Bob Lande, an antitrust professor with University of Baltimore Law School. "We thought the case was going to be almost over on Nov. 6," when Microsoft and the Justice Department announced their settlement. "Boy, were we wrong. It's not even close to over," he added. "Especially with the Netscape lawsuit we could all be still doing this two or three years from now."
Think it's all over? The antitrust case against Microsoft can still go back the to Court of Appeals, and then there's the European Commission's investigation... See ZDNet UK's DoJ/Microsoft News Section for the latest headlines. Have your say instantly, and see what others have said. Go to the Microsoft forum. Let the editors know what you think in the Mailroom.

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