Microsoft Trial Questions:
Answers To a Few Common Questions About the Trial:
4:24 p.m.
Q. What does Monday's ruling mean?
A. On Monday, District Court Judge Thomas Penfield Jackson issued his conclusions of law and final order, stating that Microsoft Corp. violated Sections 1 and 2 of the Sherman Antitrust Act. The company is also liable under the individual antitrust laws of each of the 19 states (and the District of Columbia) named in the suit. The decision wasn't entirely against the company ? Jackson did not agree with the government's allegations that Microsoft's marketing arrangements with other companies constituted unlawful exclusive dealing under the law.
Some time in the next few months, Jackson will determine possible remedies, including fines, some restriction of Microsoft's businesses practices or even possibly breaking up the company. The remedies will be the final ruling in this case, although Microsoft is widely expected to appeal any solution that strongly affects its business practices.
Q. Wasn't there already a ruling in this case?
A. Yes, a preliminary one. There are really three rulings in this case all together, with the final one yet to come. In November 1999, Judge Jackson issued the first ? the findings of fact that Microsoft was a monopolist that had abused its power and bullied competitors in ways that have stifled competition and blocked innovation. The findings' strong wording left little speculation as to the judge's upcoming conclusions of law. While the findings of fact gave an indication of how the judge would eventually rule, it did not say whether Microsoft had actually violated the Sherman Antitrust Act.
Q. What did the original suit contend?
A. In the two lawsuits filed in May 1998, the Justice Department and 19 states alleged that Microsoft used its Windows software to force an illegal monopoly of the PC operating systems market and to extend its dominance into the growing market for Internet browsing software. Already a landmark case, any ruling against Microsoft could set a legal precedent for high-tech companies, as the government's breakups of AT&T in 1984 and Standard Oil Co. in 1911 did for the telecommunications and energy industries.
Q.What happened to the settlement talks?
A. Microsoft's strategy seemed to have been "wait and see" until the findings of fact came out. After that, settlement talks, which had been limited up to that point, became more intense but collapsed completely when the software giant and the Justice Department could not agree on terms. Microsoft Chair Bill Gates said, "It became impossible to settle because the Department of Justice and the states were not working together. Between them, they appeared to be demanding either a breakup of our company or other extreme concessions." Sources close to the case reported that negotiations collapsed when Microsoft insisted on its own proposal to settle the lawsuit, a plan which amounted to a rejection of the government's solution.
Q.Can Microsoft still settle?
A. There's a remote chance Microsoft could still settle, although legal experts say that's highly unlikely.
Q. What happens next?
A. Now that Jackson has found that Microsoft did violate the law, he will set remedies, which could involve further hearings and arguments. The final order, which may not be decided for months, could range from a breakup of the company to curbing specific business tactics.
In the meantime, smaller companies and individuals would likely find the confidence to file their own suits against Microsoft ? adding to an already growing pile of class-action suits against the company. The software behemoth could quickly find itself awash in litigation, which could hamper its efforts to push ahead in a rapidly changing industry.
Q. What will happen if Microsoft appeals and wins?
A. Microsoft will almost certainly appeal. Bill Gates has said so in repeated statements. While it is unlikely that the ruling could be completely overturned, a successful appeal could narrow the recommended remedies to the point where they would have a light impact on Microsoft.
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