Justice, Microsoft Settle Contempt Dispute

By Terry Frieden/CNN


WASHINGTON (CNN) -- The Justice Department and Microsoft announced an agreement Thursday in the government's case that Microsoft had violated a federal court order. The Justice Department issued a statement saying the deal "gives computer makers a meaningful choice of computers they sell." By settling this part of the government's anti-trust suit, Microsoft avoided a contempt of court citation.

The government statement said, "Microsoft has agreed to immediately make available the most up-to-date fully functional version of Windows 95 without forcing computer manufacturers to take its browser as well."

Assistant Attorney General for Antitrust Joel Klein called the settlement "a victory for consumers and innovators." But he made clear the government's battle with Microsoft continues on other fronts.

The Justice Department's Antitrust Division had accused the software giant of contempt for refusing to comply with Judge Thomas Penfield Jackson's December ruling that the firm separate its licensing of its web browser from the Windows 95 Operating System.


The judge's order required Microsoft to offer computer manufacturers the option of licensing Microsoft's Windows without also licensing its Internet Explorer. But within days, the Justice Department concluded Microsoft was providing the computer makers with versions of Windows that were no longer commercially viable or simply didn't function properly. The government filed a contempt charge, and asked the judge to fine Microsoft $1 million a day.

In the highly technical arguments heard last week, Jackson appeared highly skeptical of Microsoft's presentation that it was technically impossible to carry out the judge's order. Closing arguments in the case had been scheduled for today.

The government emphasized the deal reached on the contempt charge does not resolve other aspects of its case against Microsoft. The firm has appealed the judge's December order, and the judge's appointment of a Harvard professor as a technical expert, or "special master," to assist in his handling of the case.

The government statement added, "The Department's investigation of other practices by Microsoft is continuing."

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