FOCUS-Justice, Microsoft not in talks - source
By David Lawsky
WASHINGTON, March 9 (Reuters) - There have been no
settlement talks between Microsoft Corp <MSFT.O> and the
government and any company offer to settle the antitrust case
would face skepticism, a source close to government lawyers
said Tuesday.
"There's been no discussions, nobody has talked yet," said
the source. "There's a possibility that Microsoft might make
some offer, but the government is generally skeptical it would
be a serious offer."
Microsoft suggested that the onus was on the government to
come up with a settlement proposal.
"The government has not made any good-faith attempt to
settle this in a way that did not violate our right to improve
our products for our customers," said Microsoft spokesman Dan
Leach.
But an economist said that Microsoft was being unrealistic.
The antitrust trial has gone well for the government and it
can "reasonably seek a pretty strong remedy," said Carl
Shapiro, a University of California at Berkeley economist who
was once chief economist for the Justice Department antitrust
division.
"Are they (at Microsoft) prepared to be realists?" asked
Shapiro. "So far they haven't been."
Speculation that Microsoft might settle its antitrust case
with the Justice Department and 19 states was fueled by a
surprise settlement on Monday between the Federal Trade
Commission and chip maker Intel Corp <INTC.O>.
That helped drive up Microsoft stock on Tuesday and
Wednesday, which closed up $2.8125 at $161.8125.
The government has charged the software giant with holding
monopoly power with its Windows operating system for personal
computers. The government alleges that Microsoft has abused
that power.
When the Microsoft trial broke last month for six or more
weeks, District Court Judge Thomas Penfield Jackson suggested
the two sides should use their time wisely. That was read as
suggesting that settlement talks should be held.
But it would be far more difficult to settle the Microsoft
case than the Intel case, experts say.
The Federal Trade Commission laid out specific proposed
remedies in its complaint. Intel agreed to those remedies, with
some modifications.
The government case against Microsoft laid out no proposed
remedies.
And while the outcome of the Intel trial was unclear -- it
had not started when the deal was cut -- the government has the
edge in the Microsoft trial. Most observers expect Jackson to
rule against Microsoft after hearing rebuttal witnesses and
closing arguments.
Privately, people involved in the case have talked about
the possibility of a separate "remedies phase," to take
testimony from people hurt by Microsoft and to consider the
pluses and minuses of various solutions.
The remedies phase alone could take two weeks to a month,
those people close to the case have said.
Against this background, Microsoft would have to make an
attractive offer to the Justice Department to get things going,
experts said.
There is no reason to expect the Justice Department to go
to Microsoft.
The Justice Department "had a kind of unpleasant back and
forth leading up to the trial," said Shapiro.
Microsoft proposed talks before the trial and the
government agreed. But the government lawyers were disappointed
by Microsoft, which, in their estimation, seemed to make no
serious offer to settle. |
