[linux-elitists] Another strong argument for killing the MSFT settlement

Karsten M. Self kmself@ix.netcom.com
Thu Nov 8 14:00:34 PST 2001


Sally Pipes of the Pacific Research Institute, a well-known Microsoft
mouthpiece, is decrying the discovery of backbone in one out of two AGs
in the 18 states pursuing antitrust actions against Microsoft despite
the lovefest declared by the DoJ.

"What is clear enough, though, is that it will not serve anyone's
interest -- except perhaps Microsoft's commercial rivals"...
Hmm...Microsoft, company that has declared scorched-earth war on *any*
competition.  Does't that make "commercial rivals"...everyone?

    State AGs sabotaging Microsoft settlement
    Sally C. Pipes
    Thursday, November 8, 2001
    ©2001 San Francisco Chronicle

    IT'S DEJA VU all over again: a handful of state attorneys general,
    California's Bill Lockyer among them, are attempting to sabotage a
    settlement of the Microsoft antitrust case. Just why the attorneys
    general are once more bucking efforts by the Justice Department and
    nine states to move on is anyone's guess. What is clear enough,
    though, is that it will not serve anyone's interest -- except perhaps,
    Microsoft's commercial rivals -- to force this case back into the

    A year ago February, Thomas Penfield Jackson, the trial court judge,
    appointed a distinguished jurist, Judge Richard Posner of the U.S.
    Court of Appeals in Chicago, to mediate a settlement. With draconian
    penalties looming, Microsoft accepted demands by the Justice
    Department that included tough, continuing regulation of the company's
    marketing tactics.  But the hard-line state Attorneys general --
    notably those from California, Connecticut, Massachusetts and Iowa --
    vetoed the deal, leading the frustrated mediator to point out in
    public that the "states do not have the resources to do more than free
    ride on federal antitrust litigation, complicating its resolution."

    Since then, an appellate court has rolled back most of the findings of
    legal liability that gave the government its leverage and instructed
    the trial court to create remedies that fit the "drastically altered"
    circumstances.  Under prodding to settle from the newly appointed
    judge, Colleen Kollar- Kotelly, prosecutors worked out another deal
    that puts a lid on Microsoft's aggressive behavior -- albeit one less
    confining than the agreement California Attorney General Lockyer and
    company so righteously dismissed almost two years ago. A rump group of
    attorneys general have now declared that they will oppose the proposed
    settlement when Judge Kollar-Kotelly formally reviews it.

    Why are they asking the court to derail the settlement, effectively
    guaranteeing that the case won't be resolved for years? The state
    attorneys general claim the high ground as defenders of consumers, but
    it is hard to see what consumers of software would gain in prolonging
    this legal agony.

    Besides, the California voters who elected Lockyer are investors as
    well as consumers.  The last time the attorneys general vetoed a
    settlement, the value of Microsoft stock held by the pension funds
    representing California's public school teachers and state employees
    fell by a whopping $1.2 billion. While the shock of a setback might
    not be as large this time around, the last thing investors need in
    this economic climate is another source of uncertainty.

    Continuing to drag out the case is economically irresponsible.
    Americans have already paid at least $35 million in costs at the
    federal and state levels for the antitrust enforcement against
    Microsoft.  By its own estimate, the California attorney general's
    office has already put in 4,422 hours of work into the case, costing
    taxpayers $1.4 million. That is too much to spend at a time when the
    state's government is so cash-starved that it has announced that it is
    raising the sales tax.

    Perhaps Lockyer is simply defending California-based companies that
    are Microsoft's bitterest rivals:  Netscape, Oracle and Sun
    Microsystems.As Judge Posner complained, the state attorneys general
    "are subject to influence by interest groups that may represent a
    potential antitrust defendant's competitors."

    But, so parochial a stance would be shortsighted. California is the
    state that depends most on the speedy recovery of high-technology
    industries.  And that recovery surely depends, in part, on letting
    important American companies such as Microsoft get back to doing what
    they do best: innovating, not litigating.

    Sally C.  Pipes is president of Pacific Research Institute, a San
    Francisco-based public policy think tank.

    ©2001 San Francisco Chronicle Page A - 27

Karsten M. Self <kmself@ix.netcom.com>       http://kmself.home.netcom.com/
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