MS case must go to high court quickly - Klein

By David Lawsky

WASHINGTON: To resolve the key issues for the high-tech industry and the public, Justice Department antitrust chief Joel Klein said it is important that the Supreme Court agree quickly to hear any appeal in the Microsoft Corp. case.

Klein, speaking the day after a lower court ordered that the software giant be split in two to promote competition, also set a high bar for any talks to settle the case. It was imperative "that a settlement meaningfully address the harm that's occurred to this market," Klein told reporters as he joined Attorney General Janet Reno at her weekly news conference. Previous settlement efforts have failed. Klein said the pace of enormous changes in the marketplace would be directly affected by Microsoft's willingness to either live by the law or continue to abuse its monopoly power. "It's very important to get a final ruling before the US Supreme Court," Klein said.

A rarely invoked law permits appeals directly to the Supreme Court for antitrust cases involving major national companies, if four of the nine justices agree. The Justice Department is poised to apply for expedited high court review once Microsoft formally files for appeal.

Microsoft took a preliminary step in that direction Thursday by filing a request with District Court Judge Thomas Penfield Jackson to prevent any part of his order from taking effect as scheduled. If that is denied, as expected, Microsoft will go to the U.S. Court of Appeals. "We believe the court's order should be stayed in its entirety," said a Microsoft spokesman Mark Murray. Murray said there are many "elements that would impose severe costs and disruptions on consumers and Microsoft immediately."

Judge Jackson Wednesday ordered Microsoft split in two, but stayed the decision until the appeals process is exhausted. In the meantime, Jackson ordered stringent restrictions on the company's behaviour, set to take effect in 90 days. The restrictions would disappear three years after the company was split. Microsoft said it would seek a stay of the restrictions pending appeal.

Microsoft has focused its protests on a requirement that other software makers who design such products as word processors get the same opportunity as Microsoft designers to look at the code behind its Windows operating system for personal computers. Microsoft says that amounts to confiscation of its intellectual property.

The government argues there should be a level playing field, as Microsoft already allows some companies to see its code. Klein called the restrictions straightforward and fundamental, saying they prevented Microsoft from intimidating computer manufacturers who chose other companies' products and from illegally tying two products together as a way to force them on consumers.

"During the time of the appeal, it's very important that further harm to the market, much of which has been thoroughly documented by the court, not take place," said Klein. Klein expressed optimism that Microsoft Chairman Bill Gates might share his views on a direct appeal to the high court, but Microsoft's Murray said that the company wants to follow the normal route to the U.S. Court of Appeals.

Microsoft has reason to like that court. At a press conference soon after the decision Wednesday, Microsoft chief counsel Bill Neukom recalled that the D.C. Court of Appeals "absolutely vindicated Microsoft's conduct" in an earlier scuffle with the government, overturning Jackson in 1998.

(C) Reuters Limited 2000.