Report Says Settlement Offer Likely

BOSTON (03/24/2000) - USA Today reported today that Microsoft Corp. is likely to make a "sweeping offer" today in an attempt to end the antitrust case brought against the company at a time when federal prosecutors are backing off their push to break up the software maker.

Such an offer would probably lead this weekend to a meeting including Microsoft Chairman Bill Gates, Assistant U.S. Attorney General Joel Klein, who heads the U.S. Department of Justice (DOJ) antitrust division, and Richard Posner, chief judge of the 7th Circuit U.S. Court of Appeals in Chicago, who is serving as mediator in the settlement talks, the newspaper reported. The report did not attribute information regarding the proposal to specific sources.

The nine-paragraph article twice makes mention of people close to the case as sources for specific bits of information reported, but the assertions that Microsoft is likely to make an offer and that such a proposal is likely to lead to the Chicago meeting were without attribution.

Yesterday, the Wall Street Journal and the Washington Post published articles citing anonymous sources saying that the two sides are close to a settlement.

[See, "Reports Say MS-DOJ Closer to Settlement," March 23. ] Microsoft spokesman Cullinan yesterday denounced the reports, saying that anonymous sources don't have to take responsibility for their comments.

Cullinan today had no comment on the USA Today story, and would not say whether Microsoft would propose a settlement anytime today.

U.S. District Judge Thomas Penfield Jackson is due to issue his conclusions of in the case, and a meeting he had earlier this week with both parties seems to have set off the flurry of anonymously sourced articles. That he appointed a mediator to handle settlement discussions between Microsoft and the government indicates his desire to see the matter settled. Mediation is not a public process, and the content of the talks is supposed to be confidential.

Jackson, who would have to approve any settlement agreed to by the sides, ruled last November that Microsoft is a monopoly and has followed anticompetitive business practices. His conclusions of law will establish whether he believes that Microsoft has violated federal antitrust laws.

The DOJ and 19 state attorneys general filed the suit, which alleges that Microsoft has illegally used its dominance in the operating system market to squelch competition in the Internet browser market. The case focuses on Microsoft's "tying" of its Internet Explorer browser to the Windows operation system.

Microsoft, in Redmond, Washington, can be reached at +1-425-882-8080 or http://www.microsoft.com/.The DOJ can be reached at http://www.usdoj.gov/.

(Additional reporting by Keith Perine of The Industry Standard.)

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