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Microsoft urges settlement with states


By Sam Costello

(IDG) -- Responding to the settlement proposal put forth on December 7 by the District of Columbia and the nine states seeking greater remedies in its antitrust case with the United States government, Microsoft has urged a U.S. District Court to apply the proposed settlement already accepted by the Department of Justice and nine states to the hold-outs, saying that the new proposal was "radical and punitive" and that the states can be bound by the first settlement.

In a 36-page filing, Microsoft said that the nine hold-out states -- California, Massachusetts, Connecticut, Iowa, Florida, Kansas, Minnesota, West Virginia, and Utah, as well as the District of Columbia -- are seeking to broaden the antitrust settlement beyond its rightful scope and are attempting to damage Microsoft's business. INFOCENTER
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Microsoft instead urged the court to rule that the current settlement proposal applies to all states, including the hold-outs. Because the settlement the company has reached is with the Justice Department, which represents the U.S. public, all U.S. citizens will benefit from that settlement, including residents of the hold-out states, Microsoft said. As such, it urged the court to dismiss the hold-out states' claims and rule that the proposed settlement agreed to by the Justice Department and the nine settling states is sufficient.

The hold-out states' new proposal would force Microsoft to open the source code to its Internet Explorer Web browser, aid in the porting of its Office suite to rival platforms such as Linux, and provide the government with forewarning of any impending company purchases.

Calling the proposal "fundamentally misguided," Microsoft said that these remedies would "result in, among other things, wholesale confiscation of Microsoft's intellectual property and unprecedented government regulation of Microsoft's product design decisions."

The company said that such provisions would damage it, third-party companies, and consumers because, among other things, Microsoft wouldn't have any incentive to improve Internet Explorer.

Further, Microsoft charged that the states are trying to impose a penalty on Microsoft, rather than propose a remedy, which is what the law calls for.

"It is readily apparent that the non-settling states seek to punish Microsoft and to advance the commercial interests of powerful corporate constituents" including Apple Computer, Sun Microsystems, Palm, and Oracle, Microsoft said.

The proposal seems "calculated to inflict maximum commercial harm on Microsoft," the company went on to say.

Microsoft found further fault with the proposal, saying that it exceeds the boundaries established by the original rulings and case.


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