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Technology Stocks : COMS & the Ghost of USRX w/ other STUFF -- Ignore unavailable to you. Want to Upgrade?

To: David Lawrence who wrote (11509)	1/11/1998 10:35:00 AM
From: Glenn D. Rudolph	Respond to of 22053

Microsoft faces federal contempt charge Reuters Story - January 11, 1998 10:13 %DPR %BUS %ENT %US %SCI %NEWS %WASH %LAW CPQ NSCP MSFT V%REUTER P%RTR By David Lawsky WASHINGTON, Jan 11 (Reuters) - Microsoft faces federal charges of contempt on Tuesday for allegedly violating a judge's order requiring the software giant to sell computer makers its Windows 95 software without bundling in a Web browser. The Justice Department has asked U.S. District Court Judge Thomas Penfield Jackson to fine the world's largest software manufacturer $1 million a day for violating his Dec. 11 preliminary injunction. The government says the fine is needed to force the Redmond, Washington, software firm to adhere to a 1995 consent decree designed to increase competition in the software industry. The government stepped in last fall, after Microsoft threatened to cut off Compaq Computer's access to Windows 95. Compag needs Windows to stay in business. Compaq was doing business with Microsoft's bitter rival, Netscape Communications, which has the lead in the market for browsers -- although Microsoft is gaining. Browsers are used to access the World Wide Web on the Internet. Microsoft objected that Compaq chose to remove an "icon" for its "Internet Explorer" Web browser from the Windows 95 desktop. Microsoft told Compaq in a June 6, 1996 letter that it must restore "Microsoft Network and Internet Explorer icons on the Windows 95 desktop on all Compaq Presario machines." Otherwise, Microsoft warned, it would terminate Compaq's 1992 license agreement for Windows. The Justice Department says Microsoft's threat violated the consent degree, which says Microsoft may not tie the sales of one product to another. Microsoft has argued that Internet Explorer is an integrated part of Windows 95. Under the consent agreement, Microsoft can sell integrated products. Judge Jackson appointed Harvard law professor Lawrence Lessig, an expert in both computers and the law, to gather evidence and make recommendations to him by the end of May. In the meantime, he issued his preliminary injunction to preserve the status quo, saying that for the time being Microsoft must offer the products separately. Microsoft complied by offering an an outdated version of Windows 95 or one it said would not work. Microsoft argued that its Internet Explorer Web browser could not be removed without damaging Windows 95. At a hearing on the matter, Jackson said he had seen a court employee demonstrate the removal of Internet Explorer. He said Windows 95 appeared to work flawlessly after the Microsoft Web browser was removed and asked the company to explain why computer makers should not be allowed to do the same. Microsoft contends it has followed Judge Jackson's order. "The court's order was very specific: Allow computer manufacturers to install Windows 95 without the files that comprise the 'retail' version of Internet Explorer 3.0. Microsoft has complied fully with the court's order," the company said in an information book distributed to reporters late last week. The Justice Department said Jackson's order was never that specific. Jackson's ordered the company to "cease and desist ... from the practice of licensing the use of any Microsoft personal computer operating system (including Windows 95 or any successor version thereof) on the condition, express or implied, that the licensee also license and preinstall any Microsoft Internet browser software (including Internet Explorer 3.0, 4.0, or any successor versions thereof) pending further order of the court." Microsoft says its interpretation of the broadly-worded order comes from one portion of a sentence on pages 15 and 16 of the 19-page ruling. The Justice Department says that sentence is merely part of the judge's reasoning and not part of his order, which is only on page 19. While the two sides struggle over this, Microsoft has appealed the preliminary injunction, asked for the removal of Lessig and made a series of other motions. It files papers on a frequent basis. Last week Microsoft said perhaps its presentation of its perspective has been too strident. Chief Operating Officer Robert Herbold said in an interview the company -- and the government -- had said things that might better have not been said. "One thing we have to do is, first of all, respect the Department of Justice and respect the judge, and we're sorry if we have made any statements that would suggest we do anything but respect them," he said.