DOJ, Microsoft Lawyers Rehearse the Final Act

NEW YORK (05/05/2000) - Whatever the outcome of the antitrust battle between the U.S. government and Microsoft Corp., the two-year-old case is destined for a spot in the legal canon, alongside government antitrust battles against Standard Oil, IBM Corp. and AT&T Corp. Though the trial's endgame is still unfolding before U.S. District Judge Thomas Penfield Jackson in Washington, D.C., the case is already being picked over by legal and economic scholars -- and defended in legal circles by the Department of Justice (DOJ).

Douglas Melamed, right-hand man to Justice Department antitrust chief Joel Klein, stepped out of the shadows today to come to New York University's law school to represent the government's side of the case. Melamed faced a lawyer in Microsoft's employ, as well as other attorneys and academics. The government's hired legal gun, David Boies, was scheduled to speak at the daylong symposium alongside Melamed. But the Justice Department, apparently fearing the prospect of Boies unleashed in front of a gaggle of tech reporters, yanked him from the program yesterday.

Nevertheless, Melamed and other lawyers in attendance delivered what could be a preview of the lengthy appeals that will certainly follow Jackson's final judgment.

Melamed said Jackson's April 3 conclusions of law, which found Microsoft guilty of multiple violations of federal and state antitrust law, "shouldn't be controversial," because they upheld federal Sherman Antitrust Act tenets that are "long-established and conservative." Melamed ticked off the laundry list of offenses for which Jackson has already cited Microsoft, from welding its Internet Explorer Web browser to its Windows 98 operating system to illegally restraining ISPs (Internet service providers) from promoting the rival Netscape Navigator browser.

"A monopolist vigorously competing is okay," Melamed said. "But this case turns on particular actions taken by Microsoft... which had no legitimate purpose."

Melamed said that any exoneration of Microsoft would be "a radical departure from existing antitrust law."

Mindful that the Justice Department has been accused of being driven by prominent Microsoft rivals such as America Online Inc. (AOL) and Sun Microsystems, Melamed said that antitrust laws were intended to protect marketplace competition rather than the fortunes of individual competitors.

Charles Rule, a lawyer retained by Microsoft who was Justice's antitrust chief under U.S. Presidents Ronald Reagan and George Bush, appeared at the forum to defend the software giant. He called the government's April 28 recommendation to Jackson that Microsoft be fractured into two companies "remedial in the same way that Rome's approach to Carthage was remedial." Rule said that Microsoft's actions were legitimately competitive, and that they led to increased innovation and benefits for consumers. He derided the government's case as a "rather amorphous grab bag" that went far beyond the scope of complaint it filed in May 1998.

C. Boyden Gray, who was White House counsel under former U.S. President Bush, said he thought that Bush's son and presidential hopeful George W. Bush would drop the case if elected. A representative of Gray's Washington law firm of Wilmer, Cutler and Pickering said the firm has been tapped to file a supporting brief along with Microsoft's May 10 counter-remedy proposal. Microsoft's filing is expected to decry the government's breakup proposal as draconian, to offer a counter-remedy consisting of restrictions on the company's business practices, and to push for broad new evidence discovery and witness rights that could keep the case in Jackson's courtroom for several more months.

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