MS/DOJ - Remedy trial opens with states' demands

The states that are seeking tougher remedies against Microsoft asked a federal court today to make Internet Explorer software code open source as a way of denying the company the benefits of its illegal conduct.

In U.S. District Court, Brendan Sullivan, the attorney representing the nine states that have refused to sign the Bush administration's settlement in the case, told Judge Colleen Kollar-Kotelly that tougher remedies are needed to protect new technologies from a company that left "nothing to chance" in attacking its competitors.

Sullivan also told the court that the company should pay a price for its actions, and called on the judge to give developers complete access to Internet Explorer's programming code.

The browser "is the fruit of Microsoft's statutory violations -- it is the fruit, there is no clearer fruit and it should be denied them," said Sullivan.

Today marks the start of two months of hearings on a set of remedy proposals offered by the nine states, as well as the District of Columbia, that have rejected the government's settlement as having too many exceptions and being unable to unfetter the market from Microsoft's dominance. Nine other states agreed to the settlement, reached last year.

"The plaintiffs are not here to seek the destruction of Microsoft," said Sullivan. "The plaintiffs' goal is to make sure Microsoft behaves properly.

"Microsoft has done much good in this world, but it has also acted very, very badly," said Sullivan.

In his presentation, Sullivan reviewed key pieces of evidence that were entered during the 76-day trial that ended two years ago to frame and explain the rationale behind the state's remedy proposals.

Microsoft is expected to make its opening statement later today.

The heart of the state's case will be based on testimony from witnesses such as Peter Ashkin, president of product strategy at Dulles, Virginia-based America Online Inc., who is expected to tell the court that the settlement doesn't provide PC makers with sufficient flexibility to choose non-Microsoft products. An official from Sun Microsystems Inc. is supposed to argue about shortcomings in the settlement's Java protections.

The states will also bring in new evidence. San Diego-based Gateway Inc. plans to testify that Microsoft's recent implementation of uniform licensing terms favors some PC makers over others. Carl Ledbetter, chief technology officer at Novell Inc., is to testify that the settlement won't restore competition in the server market. And Santa Clara, California-based handheld device maker Palm Inc. wants to address its interoperability concerns.

Microsoft attorneys are expected to argue, in response, that the states are acting beyond the scope of the conduct cited in the U.S. Court of Appeal's decision in June. They will tell the court that the settlement authored by the U.S. Department of Justice is designed to address those specific findings. The appeals court upheld a lower-court ruling that Microsoft had illegally maintained its monopoly in its Windows operating system.

Anticipating the company's arguments, Sullivan reviewed Microsoft's actions against competitors, which he said included rewards, punishments, threats and sometimes "plain old trickery and deceit" to attack potential threats to its operating system dominance.

Sullivan said Microsoft viewed Netscape Communication Corp.'s Navigator Web browser and Sun Microsystems Inc.'s Java as top threats that held the potential of commoditizing the underlying operating system. Instead of writing applications to the Windows operating systems, developers could have written applications to Java and Navigator instead.

Microsoft officials' fear that the Windows operating system could be reduced to a commodity was like "Kryptonite to Superman" -- something "that they can't deal with," Sullivan said.

He added that a remedy must be strong because "it must control one of America's strongest companies."

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