NewsMax.com Wires
Wednesday, Aug. 8, 2001

U.S. District Court Judge Thomas Penfield Jackson has been removed from the case by an intermediate appeals court because of his anti-Microsoft comments to the media. For instance, Jackson told one interviewer that Microsoft founder Bill Gates "has a Napoleonic concept of himself and his company."

Microsoft's petition to the Supreme Court argues that the appeals court made a mistake in not disqualifying Jackson "as of the date of his earliest known violation [of U.S. law] and the Code for Conduct of United States judges, thus requiring that his findings of fact and conclusions of law be vacated."

In other words, Microsoft is asking the Supreme Court to bring the case back to square one.

The software giant contends in its high court petition that action by the Supreme Court on the issue "is important to restoring public confidence in the integrity of the judicial system."

The federal appeals court said in its June decision that although it found "no evidence of actual bias," it held that Jackson's actions "in granting interviews to the media and making public comments about Microsoft "seriously tainted the proceedings before the District Court and called into question the integrity of the judicial process."

Because of those comments, the appeals court panel said, it was required to throw out, "the final judgment on remedies, remand the case for reconsideration of the remedial order, and require that the case be assigned to a different trial judge on remand."

In essence, that meant that Jackson's order splitting the company in two - with the Windows operating system spinning off from the rest of the company - was struck down and some other judge would hear the case at the trial level on what action should be taken against Microsoft to curb its illegal conduct.

Among other things, the appeals court made it tough in its ruling for any new trial judge to break up the company on remand, saying the government would first have to prove a direct causal relationship between the company's anti-competitive conduct and its dominance of the marketplace. So far, the appeals court, the government had failed to make that connection.

The appeals court said if the government could not prove that direct relationship, then the proper remedy would be an injunction against the improper anti-competitive conduct rather than breaking the company apart.

Despite that partial victory, the appeals court upheld most of Jackson's ruling.

In the beginning of the case, the Justice Department and 19 states alleged that Microsoft violated federal antitrust law by "bundling" its browser, Internet Explorer, into its Windows operating system.

Because the vast majority of personal-computer vendors or manufacturers had to install Windows on computers before they were sold, the Justice Department and the states alleged, Microsoft was forcing its browser down consumers' throats at the expense of arch-rival Netscape.

The department and the states also alleged that Microsoft put licensing restrictions on products such as Windows that were designed to reinforce its monopoly in the marketplace.

After a bench trial on the government's antitrust complaints, Jackson ordered Microsoft in June 2000 to spin off its Windows operating system from the rest of the company, and to curb its aggressive business tactics. The judge stayed the effects of his ruling until it could be appealed.

The department and the states, with Jackson's approval, then asked the Supreme Court to hear any appeal directly under a special federal law. The Supreme Court refused, saying the intermediate U.S. Court of Appeals for the District of Columbia would have to hear the case first. The D.C. appeals court then agreed to hear the case "en banc," with all of its non-excused judges sitting, rather than assign the case to a three-judge panel.

The appeals court upheld part of Jackson's ruling that Microsoft violated the Sherman Act by "employing anticompetitive means to maintain a monopoly in the operating system market," though it reversed his determination that the company violated the act by illegally attempting to monopolize the Internet browser market.

The unsigned, or "per curiam," opinion said the appeals court was sending the case back down for retrial on whether Microsoft violated section 1 of the Sherman Act "by unlawfully tying its browser to its operating system."

The appeals court also said it rejected Microsoft's claim that it did not exercise monopoly power. In addition, the appeals court upheld Jackson's finding that Microsoft Windows dominated its market, and engaged in anti-competitive conduct in violation of the Sherman Act.

With one exception, the appeals court held that all the licensing restrictions that Microsoft placed on contractors "represent uses of Microsoft's market power to protect its monopoly, unredeemed by any legitimate justification. The restrictions therefore violate section 2 of the Sherman Act."

Microsoft's failure to include Internet Explorer in an add/remove program "and its commingling of browser and operating system code constitute exclusionary conduct, in violation of section 2" of the Sherman Act, the appeals court ruled.

The appeals court also agreed with Jackson in ruling that Microsoft had intended to deceive Java developers. Microsoft tried to get them to create applications of the powerful programming language using Microsoft tools that would make them Windows-dependent, the appeals court said, rather than being able to work on all platforms. That also violated the Sherman Act, the appeals court said.

Thursday, the appeals court refused a Microsoft request to reconsider a key element of the case.

That brought Microsoft's petition to the Supreme Court Tuesday.

Led by the corporation's lead attorney, John Neukom, Microsoft argued in its petition that all of Jackson's ruling, his conclusions of fact and his conclusions of law should have been overturned because of his anti-Microsoft comments.

"Although the court of appeals attempted to assure the public (and Microsoft) that it had 'reviewed the record' and discerned no evidence of actual bias,'" Microsoft said, "… that bland assurance cannot remedy the appearance of bias created by the district judge's pervasive misconduct … Given the importance and the intense public attention it has received, this Court should make that judgment."

Microsoft's petition still has to be answered by a brief from the Justice Department. The Supreme Court might not decide whether to take the case until later this summer, or even this fall.

(No. 01-236, Microsoft Corp. vs. United States of America et al.)

Copyright 2001 by United Press International.

All rights reserved.

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