Microsoft judge skeptical about quick dismissal

Peter Kaplan

WASHINGTON: A federal judge on Thursday expressed skepticism about Microsoft

Corp.'s bid for a quick dismissal of tough antitrust sanctions being sought by

nine states.

US District Judge Colleen Kollar-Kotelly, quizzing both sides on their legal

arguments in the landmark case, raised doubts about Microsoft's main argument

for dismissal. Microsoft says the states have no standing to pursue matters any

further because the Justice Department has agreed to settle with the company.

But Kollar-Kotelly noted that neither the original trial judge nor a federal

appeals court had raised doubts about the states' right to pursue the case.

"My inclination would be to find that the court of appeals did not have a

problem, or we would have heard from them," Kollar-Kotelly told Microsoft

attorney John Warden.

The appeals court last June upheld trial court findings that Microsoft

illegally maintained its Windows operating system monopoly, but rejected

breaking the company in two. The appellate judges sent the case back to a new

judge, Kollar-Kotelly, to consider the most appropriate remedy.

The judge challenged Warden on Thursday to name any case that would directly

support the company's argument. Warden said the judge could find some support

for the company's theory in previous Supreme Court rulings. "The injury

(the states) allege is an injury to the whole world, and they aren't surrogates

for the whole world," Warden said.

Microsoft cites no cases



But Warden conceded that he could cite no previous court rulings that would
directly support the idea that the states have no right to sue. "There is

no case that is on all-fours with this case," Warden said.

The hold-out states, including California, Massachusetts, Iowa and

Connecticut, have refused to sign on to the proposed settlement that Microsoft

reached in November with the Justice Department and nine other states. In

February, Microsoft asked the judge to dismiss the states' proposals, arguing

that they lack standing without the federal government's support.

The legal maneuver sparked objections from many states, even some who had

agreed to the settlement, as it trampled on their rights to pursue antitrust

matters under federal law. The Justice Department said last month it could find

"no definitive case law that would require granting the (dismissal)

Microsoft seeks as a matter of law."

An attorney for the states, John Kester, told the judge on Thursday that

under Microsoft's argument, the states would be banned from prosecuting bank

robbers who hold up banks nationwide. "Microsoft is known for inventing

software. In this case, Microsoft is trying to invent law, and it is not

authorized to do so," Kester said.

The judge had few questions for Kester. But she did ask him what limits, if

any, should apply to the states' authority. "I think the limit is the good

judgement of the court," Kester replied. Kollar-Kotelly also queried the

two sides about another motion for dismissal that Microsoft filed more recently.

In that one, the company argues that the states have failed to prove that its

anti-competitive tactics impacted the market.

"They've offered no evidence in the remedy proceedings that goes beyond

the (original) trial," Microsoft attorney Dan Webb told the judge. But

states attorney Steve Kuney disagreed with Webb, telling the judge that the

states had provided "significant, powerful evidence" that Microsoft's

anti-competitive tactics had strengthened its monopoly and were continuing.

Webb also argued that there was no need for further sanctions against

Microsoft because the company had stopped using the tactics deemed illegal by

the appeals court. Kollar-Kotelly balked at that notion. "This is not a

voluntary stopping," she said. "There's no reason not to enjoin the

conduct."