In a brief filed with the U.S. Court of Appeals Monday, Microsoft Corp. blasted a lower court's decision in the government's antitrust case, asserting that U.S. District Judge Thomas Penfield Jackson's ruling to break up the software giant was based on a misunderstanding of antitrust issues. Calling the entire proceeding "infected with error," the company argued in the brief that because of a variety of factual, legal and procedural errors, the ruling should be reversed. Microsoft said that the ruling would harm, rather than encourage innovation.
"Revealing a profound misunderstanding of the antitrust laws, the district court condemned Microsoft's competitive response to the phenomenal growth of the Internet and the emergence of Netscape (Inc.) as a platform competitor," Microsoft argued. "Far from violating the antitrust laws, Microsoft's conduct was procompetitive, producing enormous consumer benefits."
The brief's attack spread across a broad legal canvas. It asserted that Jackson's speaking tour after the trial, "together with his improper handling of the litigation" colored public perception of the case, "undermin(ing) all confidence in the integrity of the proceedings."
In the brief, Microsoft claims that Windows and Internet Explorer are not separate products "because there are significant benefits to the integrated design of Windows that cannot be duplicated by combining an operating system with a stand-alone Web browser like Navigator."
The appeals court ordered Microsoft to present its brief -- not to exceed 150 pages -- on Nov. 27. It subsequently ordered a 25-page joint "friend of the court" brief from the Association for Competitive Technology and the Computing Technology Industry Association also to be presented Monday, along with a joint brief from the Association for Objective Law and the Center for the Moral Defense of Capitalism.
The court scheduled the U.S. government to file its reply January 12, 2001.
Jackson ruled on June 7 that Microsoft had used its dominance in operating systems to quash competition. Adopting the proposal of U.S. Department of Justice prosecutors, he ruled Microsoft must be broken up into two separate companies.
One company would own the Windows operating system -- subject to conduct restrictions -- while the other would own applications, including the Microsoft Office suite of software applications and the Internet Explorer Web browser. Jackson's final judgment stayed the breakup until the end of the appeals process.
Microsoft's brief asserts that "the district court's so-called 'conduct' remedies -- particularly the forced disclosure of Microsoft's intellectual property and regulation of Microsoft's operating system design -- are punitive and excessive in relation to the asserted antitrust violations, and these remedies will harm, rather than benefit, consumers."
Microsoft is on the Web at http://www.microsoft.com/. The U.S. Department of Justice: http://www.usdoj.gov/.