Re: MSFT court decision....read this.
WASHINGTON (Dow Jones)Ladies and gentlemen, start your cell phones.
At 10 a.m. on Tuesday and Friday mornings, an ever growing gang of reporters crowds the clerk's office at the U.S. Court of Appeals for the District of Columbia, clamoring for an opinion in a case known as U.S. v. Microsoft Corp. (MSFT).
Financial wires, broadcasters and online reporters open cell phone connections to editors waiting with prewritten headlines that cover the waterfront of outcomes. While analysts say traders have already assumed the world's most powerful technology company has a leg up in its appeal of Judge Thomas Penfield Jackson's breakup order now stayed pending appeal a market moving surprise is always possible.
So the financial reporters are watching nervously for the opinion clerk, scheduled to post the day's releases at 10 a.m. on Tuesday and Friday. The group has ballooned so large that the dull roar of cellphone chitchat between waiting scribes and editors recently drew a surprised and irritated glance from a clerk trying to work at her computer.
The opinion clerk arrives. Chat ceases. Without prompting from the reporter posse, he answers the question on everyone's mind.
"No Microsoft today," has been his answer so far. Someday the answer will be different. Reporters covering this hypercompetitive news story hope it will be soon.
It's been more than three months since the Appeals Court heard two days of arguments in the landmark antitrust case on Feb. 26, 27. A decision was seen as possible by perhaps the end of May but that was no more than an educated guess.
"I used to shoot for 60 days," says former Chief Judge Abner Mikva, who served on the Appeals Court for 15 years and is now a visiting professor at the University of Chicago School of Law. Microsoft was heard "en banc" by the entire panel of judges rather than the typical three-judge panel and such opinions often take 90 to 120 days to gel, he adds.
While the court in May stopped hearing new arguments and won't resume until September, it has no real deadline forcing a decision on pending cases. Judges struggling with an important decision may not finish their work until midsummer, Mikva notes.
The tradition of issuing opinions at a set time on Tuesdays and Fridays, done in part to accommodate the public and the media, Mikva said, would seem to bring some predictability to the release. But it's a rule that can be broken.
"If it's really urgent, something that won't keep, the court will come out with something ahead of time," Mikva says. He recalls staying an execution on a Thursday afternoon, a case in which delay would have been, literally, deadly.
"In this case (Microsoft), as important as it is, there's nothing that turns on exactly when it comes down," he says.
Except for the stock market.
"If I had to guess, they would do it on a Friday after the market closes because that's the easiest way to avoid stirring up the market," Mikva says. "Some judges are more Wall Street savvy than others."
Typically, the release is made by the judge writing the majority opinion, Mikva says. In the Microsoft case, "I would hope the chief judge would be in on the decision making, since, whatever kind of precedent it sets, it is an important decision immediately, in the here and now, and the court should think of the most orderly way of handing down the decision."
Parenthetically, the current chief judge, Harry Edwards, announced he'll relinquish his position in midJuly. He hasn't responded to a letter from reporters asking for him to outline a process for release of the opinion.
And what of the case's impact on the market?
Bill Whyman, an analyst with the Precursor Group, says he's repeatedly told big institutional investors that the appeals court is likely to overturn much, though not all, of Judge Jackson's decision. If that happens, "the stock won't move much.
"But if you get a substantial government victory, that's where you'd get a breakout," he adds. On the other side, he believes there's a one in four chance the Appeals Court could order a retrial on procedural grounds, increasing the likelihood of a favorable Microsoft settlement.
Microsoft's new Windows XP operating system, due for release in October, and its Internet strategy have raised some of the same concerns among critics as did the act that prompted the government's antitrust case: Microsoft's bundling of its Internet Explorer browser to its monopoly Windows operating system. Judge Jackson ruled that Microsoft illegally "tied" Explorer to Windows to drive the competing Netscape Navigator out of business.
The government claim of tying, however, is seen as the most vulnerable of the three counts in the case. That's in part because the Appeals Court has already applied a permissive test for tying to an earlier Microsoft case.
Microsoft's XP strategy poses some legal risk, says Warren Grimes, who teaches antitrust law at the Southwestern University School of Law in Los Angeles.
"But what they are supremely confident of is that the Appeals Court will come out with an order somewhat more favorable than that which they had from Judge Jackson," he adds. "Their negotiating position is sure to be better."
Microsoft's ability to bundle other functions with Windows could still be limited some if the court upholds Jackson's finding that the company illegally attempted to maintain its monopoly in Windows, Grimes believes. That charge is seen as government's strongest.
Any remedy to monopoly maintenance is more likely to focus on Microsoft's relationships with vendors than on breakup or injunctions against bundling software, said William Kolosky, an antitrust attorney with the firm of Wilmer, Cutler and Pickering who has written a friend of the court brief on behalf of Microsoft.
"Even the Justice Department's view" of monopoly maintenance has changed, he said, away from a focus on how Explorer functions in relation to Windows. Instead, prosecutors pointed to restrictive contracts by which Microsoft strong armed computer makers and Internet service providers into shunning Navigator.
"That's a different remedy," Kolasky says.
Whatever the ruling, reporters hope their misery will be over soon.
By Mark Wigfield, Dow Jones Newswires; 2028283397; mark.wigfield@dowjones.com
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