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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: John F. Dowd who wrote (32789)	11/7/1999 9:16:00 PM
From: Jill	Read Replies (2) \| Respond to of 74651

This on Yahoo news ticker tonight, apologies if it was already posted: Splits Make Microsoft Settlement Tough By David Lawsky WASHINGTON (Reuters) - The U.S. Justice Department and Microsoft Corp (Nasdaq:MSFT - news). talked Sunday about an eventual settlement in the historic antitrust case, but their comments about a federal judge's ruling that Microsoft used monopoly power to hurt consumers underscored the vast chasm between them. U.S. District Judge Thomas Penfield Jackson Friday issued a sweeping 207-page decision -- the basis for all future legal rulings in the case -- that held Microsoft used monopoly power to harm consumers and squelch competition. The next phase of the case is to decide if Microsoft has liability. If so, the court would decide how to remedy the problem -- possibly even breaking up the Redmond, Washington, based company. The two sides have had settlement talks in the past, but they broke down more than a year ago. Both sides in a series of appearances Sunday television talk shows expressed an interest in a renewed settlement effort, but found no common ground. Joel Klein, the top Justice Department lawyer for anti-trust, said Jackson's ruling would have to be the foundation for any settlement. ``We would need a settlement that deals with the very findings that the court made in this case -- a settlement that protects consumer choice, innovation and competition,' he said on ``Fox News Sunday.' But a top Microsoft executive said Jackson's ``finding of fact' did not ``adequately reflect' the software giant's understanding of the industry, and he looked toward a possible vindication in an appeals court. ``The incidents that were described and the judge summarizes we believe don't adequately reflect the competitiveness of this industry and the innovation of this industry and we think eventually that will be born out,' Microsoft Chief Operating Officer Bob Herbold said on ABC's ``This Week.' Herbold said Microsoft experienced earlier setbacks before Jackson, but ``eventually the courts came out on the side' of Microsoft. In 1998, an appellate court reversed a ruling by Jackson in making it clear that Microsoft had a right to design products as the firm saw fit. Jackson's ruling Friday laid out his ``findings of fact,' saying which testimony and exhibits he found credible and convincing. Legal experts said ``findings of fact' are very difficult to reverse on appeal. While saying settlement is ``always an option,' Klein said on ABC that after the judge rules on the liability phase of the case, ``we look forward to a phase with respect to remedies.' Herbold said on the same show: ``There is nothing we would like more than to settle this case. We've been saying that from day one.' Several newspapers have reported Microsoft's increased lobbying efforts. The Washington Post reported recently that Microsoft lobbied Congress to cut funding for Klein's antitrust division. The New York Times reported Sunday that spending by Microsoft on lobbying doubled last year to $3.74 million and its political contributions shot up to $1.3 million. Herbold said on ABC it ``is important that we participate in the political process. But we really do think this will be resolved with the courts.' For the most part, Herbold avoided specifics about the case during his television appearances. But he said there was ``a very key principle, and that's the right for every company in this industry, including Microsoft, to constantly listen to consumers, improve their products and take it from there.' The judge found Microsoft had adhered to that principle for itself, not for other companies. Jackson wrote that Microsoft had been active in ``stifling innovation' to deter ``investment in technologies and businesses that exhibit the potential to threaten Microsoft.' He ruled that Microsoft had acted to stifle innovation by Netscape, IBM, Compaq, Intel and others.