MS ANTITRUST - Microsoft, EC prepare for ruling next week

Outcomes abound in the Monday ruling that will end the lengthy antitrust battle between Microsoft and the European Commission.

As judgment day in the nine year-long antitrust battle between Microsoft and the European Commission draws near, neither side in the protracted dispute knows for sure how it will react to the news on the day.

Although the date of the ruling by the European Court of First Instance has been public since July, the European commissioner in charge of competition, Neelie Kroes, still hasn't decided whether she will hold a press conference on Monday.

Meanwhile, Tom Brookes, a Microsoft spokesman, said the company is waiting until Monday morning before finalizing plans for addressing the ranks journalists from around the world gathering in Luxembourg, the court's location, and Brussels and who are eager to place 'winner' and 'loser' tags on the adversaries.

"How much can you prepare for an outcome you don't know?" Brookes said.

"Clearly Mrs. Kroes isn't going to give a press conference if the Commission loses outright," said Commission spokesman Jonathan Todd.

Microsoft's appeal against the Commission's 2004 antitrust ruling is the biggest event in the working lives of everyone directly involved.

They know that Monday's outcome will influence the software industry's future, and will be a reference in all future European antitrust cases, especially ones in the fast-changing world of IT.

From Microsoft's perspective, it will determine "under what circumstances market-leading companies can improve their products for consumers," said Erich Andersen, vice president and associate general counsel for Microsoft in Europe, in a statement.

"The issue here is whether Microsoft should be able to regulate the market from a super dominant position, or whether the market should determine which products should gain access to consumers," countered Todd in a telephone interview.

Both sides also know that how the outcome is perceived in the press is almost as important as the actual outcome, which is likely to be hundreds of pages in length, devilishly nuanced and highly complex.

Most people expect several versions of the court ruling to appear in the media on Monday.

Initial reports will emerge shortly after the ruling is made public at 9:30 a.m. local time, and will probably focus on whether the Commission has to repay any or all of the US$685 million fine it imposed on Microsoft in 2004.

Repaying the fine will be seen as evidence that Microsoft's appeal against the 2004 Commission ruling was successful. Letting the fine stand will be viewed as a Microsoft loss.

But what happens to the fine is the least important aspect of Monday's ruling, according to Thomas Vinje, a partner in the law firm Clifford Chance, who heads the legal team of the European Committee for Interoperable Systems (ECIS), a Commission ally.

"It's the least relevant yardstick," Vinje said. "Far more important is how the judges assess individual facts and points of law because this will determine what legal precedents can be gleaned from this case."

A senior lawyer on Microsoft's side agreed. "If the court reduces the fine on Microsoft, saying that the anticompetitive behavior isn't so serious, but upholds the Commission's broad argument, then a lawyer in a year's time dealing with a different antitrust case will be more interested in what the court specifically said than in whether the fine was reduced or not," he said, asking not to be named.

Journalists will largely be dependent on lawyers' interpretations of the document, which won't come out until some time after the initial ruling. The story may well change dramatically during the day, once details of the ruling emerge, possibly even reversing a superficial initial assessment of who won or lost.

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