Hi Brian...Some things don't change, do they? 1998 Article: Is Microsoft a victim of politics?
(Bold is mine)
KLP
"http://www.seattletimes.com/news/business/html98/micr_051098.html
Copyright ¸ 1998 The Seattle Times Company
Posted at 11:53 p.m. PDT; Sunday, May 10, 1998
Is Microsoft a victim of politics?
by James V. Grimaldi
Seattle Times Washington bureau
WASHINGTON - Consumer choice. Enforcing antitrust law. Protecting fair competition.
That's what a dozen state attorneys general are saying motivates their anticipated antitrust lawsuit against Microsoft.
While those are clearly factors, the attorneys general omit a major consideration of every elected prosecutor when selecting major cases: politics.
Constituent influence, regional differences, public opinion and business interests all become part of the political calculation, particularly in the area of antitrust, where prosecutors have limited staff and cannot take every potential case.
Those same influences come to bear when attorneys general see their home-based industries come under scrutiny. After all, Washington state Attorney General Christine Gregoire, known as a leader in other big multistate actions, has been on the sidelines in the Microsoft case: "I don't believe I have a legal basis to join the action. I see no detriment to the consumer here caused by the conduct of Microsoft," she said.
Multistate antitrust and consumer cases, such as the looming action against Microsoft, sometimes can net funds for state coffers in the form of damages. They can also win benefits for consumers. Both of those are lures for the attorneys general, whose ambition for higher office can be so thinly masked that their national organization is sometimes derided as the National Association of Aspiring Governors.
From Microsoft's vantage point, however, the attorneys general are joining an inquiry in which they are the Johnnies-come-lately. Most of their subpoenas to Microsoft asked for documents in a case that the Department of Justice has been investigating for years.
"We think it is important that the state attorneys general have all the facts," said Microsoft spokesman Jim Cullinan. "We have only given them the information they requested a few weeks ago. We think it is important to understand this complicated issue before moving ahead."
The attorneys general, though, appear willing to talk. A person close to the investigation said yesterday that the state prosecutors have begun negotiating with Microsoft officials, but it was unclear if a deal was near. Short of a settlement, a broad Sherman Antitrust Act case is set to be filed by the attorneys general from 12 states: Connecticut, Illinois, Texas, New York, Massachusetts, Ohio, California, Wisconsin, Minnesota, West Virginia, Florida and Iowa. (*** below)
The states and the federal government are in the final stages of preparing a lawsuit accusing Microsoft of maintaining a monopoly in the Windows operating system, which is run on nine of 10 personal computers, and attempting to extend that monopoly to other products. Microsoft argues it is not a monopoly and that a lawsuit will hamstring innovation of new products.
Some of the states, and especially California, are clearly acting at least partly in the interest of home-based technology companies aligned against Microsoft.
"It's not a big issue to anybody but Silicon Valley and Silicon Valley is becoming a major player in politics," said political scientist Sherry Bebitch Jeffee of the Claremont Graduate University in Southern California. "You focus on what you can do to please powerful players. It is a no-lose situation for a politician in this state as far as I can see."
However, if you are Attorney General Gregoire of Washington state, the calculation is trickier.
Gregoire was the 10th of about 40 attorneys general who have sued the tobacco industry. The Washington state lawsuit could either go to trial in September or end in a national settlement that is, for the moment, stalled as it awaits congressional approval.
But she is not eagerly lining up with her colleagues from other states for the Microsoft case. Instead, she is waiting to see where an expected Department of Justice antitrust lawsuit winds up. Unwilling to join the group of attorneys general but eager to monitor the case, Washington sent civil subpoenas to Microsoft last month seeking business records. So did neighboring Oregon and Idaho.
"I am not going to invest my very limited resources on duplicating their (Justice Department officials) effort," Gregoire said.
Gregoire rejected the notion that she was staying out of the process because of politics. "I don't make political decisions as attorney general," she said. "It is my job to make the best legal decision I can."
Gregoire said her career antitrust prosecutors agree.
"If the tobacco companies were headquartered in Washington state, I would have filed against them," Gregoire said. "I am looking to the law with the eye toward consumers."
Gregoire's antitrust chief Jon Ferguson agreed: "Piling on doesn't serve the interests of anybody." While such assessment of resources is normal in any attorney general's office, it is still a political one, said Jamin Raskin of the American University law school. "There is an infinite panoply of cases that can be brought, so it really requires selective political judgment about the best way to use taxpayers resources," Raskin said.
The decision is similar to the dilemma facing Southern state attorneys general in the tobacco case. South Carolina Attorney General Charlie Condon, a conservative Republican, filed suit and suffered a political fallout. Condon said he made his decision to join the tobacco suit in order to give a voice in national settlement negotiations to tobacco farmers, who produced the biggest cash crop in his state.
Condon also is among the attorneys general working on the Microsoft case.
"The attorney general of any state has a broader responsibility to protect the people and the industries of the state when that's compatible to law," said Tom Landess, Condon's spokesman. "There is nothing wrong with political realities of that sort as long as you're not ignoring the law or winking at violations."
Microsoft, keenly aware of the politics involved, commissioned and released a nationwide poll last week showing that most of the public opposes using taxpayers' dollars to investigate Microsoft.
But the political analysis that counts is done by the attorneys general themselves. And they often go after a big company in the name of enforcing the law and in an effort to look tough, said Herb Hovenkamp, a University of Iowa antitrust law expert.
"The head of the antitrust division in most states is pretty heavily and closely controlled by the attorney general, and the attorney general makes the decision largely by reading the opinion polls and the press," Hovenkamp said. "They do not bring a lot of socially unpopular antitrust actions."
ther motive, Hovenkamp said, is that federal antitrust cases can bring triple damages, a large potential windfall. Such awards put attorneys general into the enviable role of doling dollars throughout their states.
When New York was one of 50 states that won $9 million from a tennis shoe company accused of price-fixing, the attorney general took some of the state's $800,000 in proceeds and passed it out to sports programs ranging from a children's home to a seniors games program.
States mentioned in 1998---
Connecticut, Illinois, Texas# New York, Massachusetts, Ohio, California, Wisconsin, Minnesota, West Virginia, Florida and Iowa.
(#not listed in 2000)
Additional States for a total of 19 in year 2000... District of Columbia,Iowa, Kansas, Kentucky, Lousiana, Maryland, New Mexico, |
