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

To: jim shiau who wrote (13105)	12/9/1998 10:00:00 PM
From: Kenneth E. Ferguson	Read Replies (1) \| Respond to of 74651

NEW YORK - The role of 19 states in the Microsoft antitrust trial has been thrown into question as the lead litigator for the states fights for the seat he appears to have lost in last month's election. Dennis Vacco, attorney general of New York, lost the Nov. 3 election by 26,011 votes to Manhattan attorney Eliot Spitzer. Now Spitzer and a top adviser have raised questions about whether New York state has been as aggressive as it should be in the Microsoft lawsuit. The Spitzer camp also said Vacco has thrown a wrench into an orderly transition for oversight of the Microsoft trial by ordering attorneys not to communicate with Spitzer's transition team, which is scrambling to assemble a new administration by Jan. 1. Vacco, a Republican, has claimed there was massive vote fraud in the Nov. 3 election. A judge gave Vacco until Monday to get evidence to prove that Spitzer, a Democrat, is not the winner. An official in Vacco's office said it would be irresponsible to help Spitzer until the election dispute is resolved. The New York unrest is unlikely to have much effect on the Justice Departments side of the antitrust prosecution, which is led by outside counsel David Boies of New York and Phil Malone of the department's antitrust division in San Francisco. But the political fight threatens to jeopardize the effectiveness of attorneys for the states and could result in further restrictions in the states' already limited involvement. The timing of the Vacco-Spitzer controversy and the news this week that South Carolina was withdrawing as one of 20 states suing Microsoft have shined a spotlight on the states' role in the case. "It has been clear in the presentation of evidence, in the development of the theory, and in the unfolding of the whole narrative of the case that the states are a fifth wheel in that process," said William Kovacic, an antitrust scholar at George Washington University law school who has followed the trial closely. "When the big event is the defection of one of the least important of your own state-coalition members, that says a lot about what value you're adding." Spitzer has some questions for Stephen Houck, New York state's antitrust bureau chief, but Vacco's gag order has made it impossible for him to assess the antitrust team - leaving the leadership of the states at the landmark trial in doubt, said Lloyd Constantine, the chief of Spitzer's transition team. While noting that Spitzer didn't have any intention of upsetting the states' role in the Microsoft trial, Constantine said Spitzer has some concerns about the lack of aggressiveness on a number of antitrust and merger cases. Constantine wants to know why New York dropped its allegation that Microsoft was using its dominance over the Windows operating system to leverage the market for the Microsoft Office suite software for spreadsheets, word processors and the like. Without that allegation, there was little left to New York and the other states' case that didn't resemble the lawsuit filed by the Justice Department, he said. "It is not beneficial for anybody, for a state, simply to jump into an action and sit at counsel's table," Constantine said. "If they can actively participate and add something to the process, then it's great." Microsoft spokesman Mark Murray said it wouldn't be appropriate to comment on the New York state situation, but he contended that the states have not added much to the case. seattletimes.com