Microsoft Denounces Government Breakup Plan in its Final Court Filing

Published June 1st, 2000 - 02:00 GMT

Microsoft in a final submission Wednesday to a federal judge denounced a government call for its breakup as "defective" and "ambiguous," setting the stage for an imminent court ruling on the fate of the software giant. 

"It remains Microsoft's firm belief ... that the relief requested by the government is extreme and unjustified," the company said in documents prepared for US District Court Judge Thomas Penfield Jackson. 

The company was responding to the Justice Department's definitive filing on Friday, which reiterated a recommendation that Microsoft be split into two companies, one to develop the Windows operating system and another specializing in software applications. 

"The government's proposed final judgment is defective in numerous respects, making the document vague and ambiguous," Microsoft argued. 

The Justice Department blasted Microsoft's filing, calling much of it "patently irrelevant to the question before the court." 

"The filing does not come to grips with the fact that Microsoft has been found to have repeatedly engaged in serious legal violations, and serious remedies are required to restore competition and prevent similar violations in the future," the department said in a statement. 

Jackson on April 3 upheld government charges that Microsoft had violated US antitrust law and is now set to announce a final decision on remedies to correct the violations. 

Legal analysts in Washington have said the judge's decision could come as early as the end of this week. 

Jackson in April found that Microsoft, through its Windows platform, had abused its monopoly position in the market for personal computer operating systems to squelch competition. 

He also determined that the company had sought to monopolize the Internet browser sector and had illegally "tied" its browser Explorer to Windows. 

Microsoft has vowed to appeal all aspects of the case, including Jackson's surprise move last week to call a halt to future hearings on proposed remedies. 

In its response on Wednesday the company added seven more names of witnesses to a list of 16 people it put forward last week who it said would have testified against the breakup proposal had the court allowed for more hearings. 

The latest list includes the president of Compaq Computer Corporation, the chairman of retail clothing chain Nordstrom Incorporated, and the co-founder of Dreamworks film studio. On the original list were Bill Gates, founder and chairman of Microsoft, and Steve Ballmer, Microsoft president. 

If the court adopts the breakup proposal and enters a final judgment, Microsoft wants 12 months -- rather than the four months proposed by the government -- to present its own plans for what it called "divestiture," according to the documents filed Wednesday. 

The government would then have three months to submit its objections to the company's proposal, after which Microsoft would have two months to respond. 

"The timetable proposed by the government for the divestiture is unrealistic," the company said. 

"The forced breakup of a unitary company like Microsoft is unprecedented, and dividing the company in half would be an enormously difficult task. Four months is not remotely enough time to formulate a plan for attempting such an undertaking." 

Microsoft had already rejected the breakup recommendation, first unveiled by the government on April 28, and offered to accept limitations on its business practices to remedy the antitrust violations identified by Jackson. 

At a hearing last week, the judge appeared sympathetic to splitting Microsoft into three -- rather than two -- companies. The third entity would specialize in Internet browsers. 

But David Boies, the government's lead attorney in the landmark case, told Jackson that while such an option had been seriously considered, it had been rejected as being too complicated to implement -- WASHINGTON (AFP) 



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