Microsoft case had its share of twists and turns

Associated Press

WASHINGTON — The move to settle the antitrust case against Microsoft Corp. represents a remarkable shift from just months ago, when quarreling lawyers for the software giant and government couldn’t agree on much of anything.

What changed? Insiders say the better question is, what hasn’t?

Since the last round of settlement talks collapsed, there is a new trial judge, a new president, new lawyers, a newly slumping economy and a new sense of national priorities in the wake of the terrorist attacks.

The attacks presented "a powerful dynamic to resolving the issues in this case," said Richard Blumenthal, Connecticut’s attorney general and one of Microsoft’s toughest critics. "The world changed on Sept. 11."

The new trial judge, U.S. District Judge Colleen Kollar-Kotelly, made passing reference Friday to "this time of rapid national change." She earlier had implored the sides to settle "in light of the recent tragic events affecting our nation."

Attorney General John Ashcroft and Microsoft chief executive Steve Ballmer played down the impact of terrorism on negotiations.

Ashcroft called the settlement "a very strong outcome, and an outcome that would be a good outcome whether or not Sept. 11 had taken place."

Ballmer added: "I think the tragedy of Sept. 11 really stands on its own."

The sagging economy and the technology industry are in different places, too. Government lawyers hope the deal removes some of the uncertainty looming over technology markets; Ashcroft noted that a "competitive software industry is vital to our economy."

Perhaps the most significant difference between the failed negotiations of spring 2000 and the successful ones of the past week was the presidential election.

The Justice Department under Bush — who strongly favored settlement — abandoned some of the toughest penalties against Microsoft that had been proposed by the Clinton administration. Chief among them was a breakup that the software giant adamantly opposed.

Yet, Bush is sensitive to suggestions that he influenced the case; he wouldn’t discuss the landmark settlement Friday. "You need to talk to the attorney general on that, if you don’t mind," he said.

Under Bush, Justice lawyers concluded they wouldn’t try to break up the software giant, wouldn’t pursue part of the case thrown into question by an appeals court and wouldn’t try to block the sale of Microsoft’s most recent version of its Windows software.

But in negotiating a settlement, the government argued, it won immediate concessions from Microsoft without the delays from another year’s worth of court proceedings. Justice antitrust chief Charles James said the deal "has the advantages of immediacy and certainty," important in the fast-moving technology industry.

Copyright ©2001 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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