John F. Dowd, It looks like we will start see disagreements between the states happening very soon. Some state attorneys with ulterior motives want drastic measures, like California whereas others like Michigan only want a reasonable settlement. I have high lited the those two states' comments below. I expect a lot of fighting among states and hope they take a vote on proposed settlements.
Wednesday March 24 6:15 PM ET
Microsoft Proposes 'Unacceptable' Settlement
By David Lawsky
WASHINGTON, March 24 (Reuters) - Microsoft has made a proposal to settle its antitrust case but it was nowhere near acceptable to the states suing the software giant, a state attorney general said Wednesday.
''It was a minimalist opening offer,'' California Attorney General Bill Lockyer told reporters at a meeting of state attorneys general. ''It was far from what anyone in our group would expect to be adequate.''
California is one of 19 states that have joined the federal government in alleging Microsoft Corp. (Nasdaq:MSFT - news) (MSFT.O) abused monopoly power in the market for software used to operate personal computers. The trial is in recess at least until April.
Lockyer said he had not seen Microsoft's offer, but it was described to him in a brief conversation with Iowa Attorney General Tom Miller, who is leading the efforts by 19 states working with the federal government. Miller will brief the attorneys general involved in the case at a closed session Thursday during a closed lunch at a meeting of the National Association of Attorneys General.
Told of Lockyer's comments, Miller said, ''I have no comment on settlement negotiations.'' A Justice Department spokeswoman also had no comment.
Earlier in the day, Microsoft Chairman Bill Gates told an interviewer in New York that the software giant was in talks to settle the case.
''There are ongoing discussions and I won't speculate as to the probabilities or anything, but I hope it does get settled,'' Gates said in an interview with Sir David Frost at an investor conference in New York.
A senior government official responded: ''It remains to be seen whether this is anything other than another public relations offensive by Microsoft.''
Before adjourning the trial last month, the judge in the case advised the two sides to use their recess time wisely, which has been interpreted to mean that they should try to settle.
In the Frost interview, Gates reiterated his long-standing position that any settlement would have to preserve Microsoft's ''ability to innovate Windows, the ability to maintain the integrity of Windows as a fully designed product.
''As long as we can keep those intact it would be great to settle the thing,'' Gates said at the Scroders/Variety media conference in New York. He gave no hints about areas where Microsoft might be willing to give ground.
The government settled a suit against Microsoft in 1995, with the company agreeing to change its business practices. But the government later went to court because it believed the company violated the agreement.
Justice Department officials have refused to discuss what they might seek in a settlement. But state attorneys general have said any remedy agreed between the parties would have to be stronger than the 1995 agreement.
Michigan Attorney General Jennifer Granholm, who was also attending the National Association of Attorneys General in Washington, said her colleagues ''want something with teeth, something that works, unlike the previous agreement.''
On the other hand, she said, the state attorneys general ''don't want to disembowel the company,'' and noted its contributions to the computer industry and the global economy.
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