Article 68 of 200
Eventual Microsoft settlement predicted
Experts see change with new president
The Seattle Times
Copyright (c) 2000 Bell & Howell Information and Learning Company. All
NEW YORK - The Justice Department is likely to settle its landmark
antitrust suit against Microsoft under either President George W. Bush
or President Al Gore, but not under President Clinton, a politically
connected Microsoft ally and a leading academic predicted yesterday.
The predictions from two high-profile antitrust watchers come as
Microsoft has signaled it will seek to extend U.S. District Judge Thomas
Penfield Jackson's schedule in deciding the company's punishment and is
likely to oppose an expedited appeal to the U.S. Supreme Court.
The government last week presented the court a proposal to break
Microsoft in two, and the company is scheduled to present its own
C. Boyden Gray, an aide to Presidents Reagan and Bush and now a legal
consultant for Microsoft, and Nicholas Economides , dean of New York
University Stern School of Business, made their forecasts at a legal
conference on the historic antitrust case hosted by the university.
"I think the likelihood is that it be settled," Gray said. The
Justice Department would be "more the same with Gore, but there would be
a change. Any administration is going to put new people in."
Economides went further, predicting that:
An appeals court would overturn Jackson's finding that Microsoft
illegally tied its Internet Explorer Web browser to its Windows
The weakened case would be settled under Gore or Bush, but not
Microsoft's legal fees would reach $6 billion by that time.
The lengthy legal battle and continued antitrust scrutiny would leave
the software maker unable to make significant acquisitions it otherwise
would pursue during the next two years.
"I think the current administration would have a hard time settling,"
New antitrust enforcers would likely bring a less impassioned
approach, particularly under Bush, Economides said.
"But I wouldn't be surprised if Gore cut a deal as well," he said.
"His incentive would be: `It's an old case, we inherited it - let's come
up with a solution everyone can be happy with.' "
One source involved in the case said too much antagonism has occurred
among the parties for a settlement under current Justice Department
"We hate them," the source said. "They hate us."
Under traditional changes in administration, top officials such as
the attorney general - currently Janet Reno - and the assistant attorney
general for antitrust enforcement - now Joel Klein - are expected to
tender their resignations.
Gray noted that even when Reagan was succeeded by his vice president,
George Bush, new leaders were named.
George W. Bush, the former president's son, has criticized the
Justice Department's handling of the case, saying he hopes government
lawyers don't "ruin" the nation's largest software maker. But a
spokesman for Bush, who has recently faced criticism that his policies
would alter the nation's stance on gun control and other issues,
declined to say whether Bush would side with Microsoft.
"As president, he will enforce our antitrust laws to protect
consumers and foster competition and innovation," campaign spokesman
Scott McClellan said yesterday.
The Gore campaign declined to comment, as did Justice Department
attorney Doug Melamed, who also addressed the NYU gathering.
Participants were divided on how the case should be resolved. Some
insisted an AT&T-style split remains the only viable solution.
"The breakup remedy has the advantage that it's relatively simple and
it's relatively nonintrusive - that is, after the breakup itself," said
Daniel Rubinfeld, a professor of law and economics at the University of
Robert Gertner, an economics professor at the University of Chicago
who opposes the government's plan, said his ideal solution is not a
remedy the government could legally seek: "a very large fine in the high
billions of dollars."
Missing from the forum was David Boies, the attorney who has served
as lead counsel for the Justice Department during the trial. NYU
officials said Boies, who has been widely praised for his effectiveness
in presenting the government's case, called shortly before the
conference began to say Justice officials asked him not to speak at the
conference. Melamed said that the cancellation was a result of
miscommunication and that he had called Boies Thursday to let him know
he could speak, but Boies had made other plans.
Meanwhile, Gray and Microsoft attorney Charles "Rick" Rule raised the
possibility that a Bush administration might drop the case entirely,
although it is unclear whether that would be enough to stop a court case
in which Microsoft already has been found to have violated the law.
"The government can always go in and confess error in a case, and
perhaps an enlightened official will," said Rule, who was assistant
attorney general in charge of the antitrust division from 1986 to 1989.
However, he added, "They don't need political intervention to win. They
just need an appropriate application of law."
When a congressman asked Microsoft Chairman Bill Gates, during his
recent visit to Capitol Hill, whether a new administration might make a
difference, Gates said it "might," but he did not ask for help or state
a preference for the next president.
Yet Microsoft has launched advertisements apparently designed to
influence the public on the case, airing separate spots in which Gates
and Chief Executive Steve Ballmer talk about Microsoft's contributions
"I think Microsoft will win an appeal," Gray said. "That doesn't mean
they shouldn't try to end it, for the good of the nation, through
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