Microsoft-U.S. Settlement Statement (Microsoft Loses Court Case!)

Text of the Justice Department (news - web sites) release regarding its antitrust lawsuit settlement with Microsoft Corp., as provided by the department.

The Department of Justice (news - web sites) reached a settlement today with Microsoft Corporation that imposes a broad range of restrictions that will stop Microsoft's unlawful conduct, prevent recurrence of similar conduct in the future and restore competition in the software market.

-Creating opportunity for independent software vendors to develop products that will be competitive with Microsoft's middleware products on a function-by-function basis;

-Giving computer manufacturers the flexibility to contract with competing software developers and place their middleware products on Microsoft's operating system;

-Preventing retaliation against computer manufacturers, software developers and other industry participants who choose to develop or use competing middleware products; and

-Ensuring full compliance with the proposed final judgment and providing for swift resolution of technical disputes.

``A vigorously competitive software industry is vital to our economy and effective antitrust enforcement is crucial to preserving competition in this constantly evolving high-tech arena,'' said Attorney General John Ashcroft (news - web sites). ``This historic settlement will bring effective relief to the market and ensure that consumers will have more choices in meeting their computer needs.''

The settlement, which will be filed today in U.S. District Court in the District of Columbia with Judge Colleen Kollar-Kotelly, if approved by the court, would resolve the lawsuit filed by the Department on May 18, 1998.

``This settlement will promote innovation, give consumers more choices, and provide the computer industry as a whole with more certainty in the marketplace,'' said Charles A. James, Assistant Attorney General for the Antitrust Division. ``The goals of the government were to obtain relief that stops Microsoft from engaging in unlawful conduct, prevent any recurrence of that conduct in the future, and restore competition in the software market - we have achieved those goals.''

Today's proposed settlement is modeled on the conduct provisions in the original final judgment entered by Judge Jackson, but includes key additions and modifications that take into account the current and anticipated changes in the computer industry, including the launch of Microsoft's new Windows XP (news - web sites) operating system, and the Court of Appeals decision revising some of the original liability findings.

-Broad scope of middleware products: The proposed final judgment applies a broad definition of middleware products which is wide ranging and will cover all the technologies that have the potential to be middleware threats to Microsoft's operating system monopoly. It includes browser, e-mail clients, media players, instant messaging software and future new middleware developments.

-Disclosure of middleware interfaces: Microsoft will be required to provide software developers with the interfaces used by Microsoft's middleware to interoperate with the operating system. This will allow developers to create competing products that will emulate Microsoft's integrated functions.

-Disclosure of server protocols: The final judgment also ensures that other non-Microsoft server software can interoperate with Windows on a PC the same way that Microsoft servers do. This is important because it ensures that Microsoft cannot use its PC operating system monopoly to restrict competition among servers. Server support applications, like middleware, could threaten Microsoft's monopoly.

-Freedom to install middleware software: Computer manufacturers and consumers will be free to substitute competing middleware software on Microsoft's operating system.

-Ban on retaliation: Microsoft will be prohibited from retaliating against computer manufacturers and software developers for supporting or developing certain competing software. This provision will ensure that computer manufacturers and software developers are able to take full advantage of the options granted to them under the proposed final judgment without fear of reprisal.

-Uniform licensing terms: Microsoft will be required to license its operating system to key computer manufacturers on uniform terms for five years. This will further strengthen the ban on retaliation.

-Ban on exclusive agreements: Microsoft will be prohibited from entering into agreements requiring the exclusive support or development of certain Microsoft software. This will allow software developers and computer manufacturers to contract with Microsoft and still support and develop rival middleware products.

The proposed final judgment also includes key additional provisions related to enforcement.

-Licensing of intellectual property: Microsoft also will be required to license any intellectual property to computer manufacturers and software developers necessary for them to exercise their rights under the proposed final judgment, including for example, using the middleware products disclosed by Microsoft to interoperate with the operating system. This enforcement measure will ensure that intellectual property rights do not interfere with the rights and obligations under the proposed final judgment.

-Onsite enforcement monitors: The proposed settlement also adds an important enforcement provision that provides for a panel of three independent, onsite, full-time computer experts to assist in enforcing the proposed final judgment. These experts will have full access to all of Microsoft's books, records, systems, and personnel, including source code, and will help resolve disputes about Microsoft's compliance with the disclosure provisions in the final judgment.

The core allegation in the lawsuit, upheld by the Court of Appeals in June 2001, was that Microsoft had unlawfully maintained its monopoly in computer-based operating systems by excluding competing software products known as middleware that posed a nascent threat to the Windows operating system.

Specifically, the Court of Appeals found that Microsoft engaged in unlawful exclusionary conduct by using contractual provisions to prohibit computer manufacturers from supporting competing middleware products on Microsoft's operating system; prohibiting consumers and computer manufacturers from removing Microsoft's middleware products from the operating system; and reaching agreements with software developers and third parties to exclude or disadvantage competing middleware products.

The proposed final judgment will be published by the Federal Register, along with the department's competitive impact statement, as required by the Antitrust Procedures and Penalties Act. Any person may submit written comments concerning the proposed consent decree within 60 days of its publication to: Renata Hesse, Trial Attorney, 325 7th Street, N.W., Suite 500, Washington, D.C. 20530, (202-616-0944). At the conclusion of the 60-day comment period, the court may enter the proposed consent decree upon a finding that it serves the public interest.

The proposed final judgment will be in effect for a five-year period and may be extended for an additional two-year period if the court finds that Microsoft has engaged in multiple violations of the proposed final judgment.

Why am I not surprised that Microsoft bashers who laud this settlement fail to discuss why the DOJ's original demands with regards to the browser are nowehere to be seen in this settlement?

Because their arguments then were flawed three years ago just as they are now.

Have Microsoft bashers seen the light, and realized that these original demands of the DOJ were outlandish? Or are they just trying to convince themselves that they were right all along, regardless of how inconsistent the demands and results attained by the DOJ are?

It's the latter. They didn't mind wasting millions of taxpayer dollars in exchange for branding Microsoft a monopolist. So, in return, they high-five each other, pat each other on the back, and celebrate the terms that the wrung from Microsoft, forgetting all the time that the same terms were on the table from Microsoft over three years ago. But let's face it: These clowns are like LBJ in Vietnam. They couldn't pull out gracefully. Now, anything short of utter embarrassment is a victory for them.

While simultaneously complaining about their rights to life, liberty and property they also complain about MS. *and* these guys are often the first to fuss and fume that the hardware failed to properly incorporate their latest plug and play purchase (or steal).

Wonder why your software or computer costs so much and didn't function as smoothly as you wanted? It couldn't have any thing to do with government regulatory interference, right? Well:

I can't buy tetanus shots or steroids for injection since the federal tightening on production regulations.
I can't afford to do labs or x-rays in my office, because I would have to hire an entire department for each, have outside verification of my techniques and protocols, and pay thousands of dollars to CLIA each year for the privilege.
I have to charge and treat all patients (indigent and weathy, drug seeker or cancer patient) the same to prevent "fraudandabuse" charges from federal and state regulatory agencies (including the FBI).
I can't even promise you privacy in my office, if any agent of the Secretary of Health and Human Services demands to see your records.

It's all the same disease, in my opinion.

(please don't tell any lawyers that I'm diagnosing without full informed consent)

Whose principle would that be? Yours?

I know that you MS techies cannot read complete sentences written in English, but you might try, for a start, my post #194 above. That is the law. What part of NO COMBINATION in restraint of trade or commerce don't you understand.

I don't have a dog in this fight. I gave in a long time ago and use MS products in the course of my daily life because they are standard and I don't have the professional time to waste on alternatives even if better and free. I do have a dog in the anti-trust fight on several fronts - and so do you my friend unless you are one of Bill's Billionair Babies.

It is a pity that we don't teach American history anymore because you might have learned why we do have antitrust laws and you might have learned about the threat to an economy and poersonal rights and freedoms, including the property rights of others that unrestrained predatory monopolies can do to people. As we discovered, if you allow unregulated monopolies you might as well tear up the Constitution and throw it away because none of your rights are meaningful.

Many of our anti-trust laws are anti-capitalist.

No - they are anti- predatory monolopolistic capital. My family runs a very successful small business. We can compete with anyone just fine in the market. We would be out of business in a week if there were a MS in our field who were allowed to do what MS has done or what Rockefeller did or a whole host of monopolists in the era leading up to the Clayton act and Sherman act.

Andy, the pigs are squealing. The Gates of Hell got CONVICTED (can't blame this one on the Dimcraps). Bush2000 couldn't rationalize himself out of a paper bag, but he keeps trying. Plus,he is one of the lapdogs over at the Gates of Hell. Just send him a crying towel. It is sad that the boy spends his whole computer life trying to defend the indefensible. Dominic kicks his can on a regular basis on these threads.

Are you a MS shill or just honestly a teenager? Other than telling me I am screwed up I would appreciate it if you could, more articulately tell me where you believe I am wrong, so we can debate it.

It was politics - no question - but it was not just politics. The AG's of many states did not join because of politics, but because they or companies in their states were injured by MS's behavior.

Personally, I despise MS products every way, every day. I would use a Unix based (i.e. Linux) OS any day, but I have other, and more important ways, to spend my time than fixing my computer and try to maintain compatibility with what most people are using. So I live with MS products, even though the OS absolutely (put in your favorite juvinile epithets and 4 letter words here). Windoze 98 I have to reboot about 4 times a day because the OS is too stupid to kill off all of the orphaned processes that hog memory and CPU cyles when it shuts down a program. Windoze 2000 unprofessional I have to reboot once a day for about the same reasons - though it at least gives me some control over that - though hitting the panic button is usually quicker than going down the list of processes to figure out which belonged to what program. Actually Windows 95 is more stable than any of these - but I have to have - so HERR OBERFUHRER Bill tells me - all the bells and whistles that I never wanted.

Microsoft is officially a criminal, anti-capitalist 'looter' corp.

Spoken like a true anti-capitalist. I suspect anyone who makes more money than you, is more successful than you, has better ideas than you, works harder than you is a "looter."

Pity. Jealousy in America rears its ugly head. Government sanctioned, public sponsored punishment of successful companies is at the heart of SOCIALISM.

Glad to see your a subscriber. (/sarcasm)

BTW: who's operating system are you using to surf Free Republic?

Listen, Transmeta's locker room talc boy, if this is how Microsoft "loses", I wish it would lose a lot more. Examine the facts, you troll:

If anyone has lost, it's your side. But look on the bright side. You are so used to losing that ... what's one more loss among many, huh?!?

That is the law. What part of NO COMBINATION in restraint of trade or commerce don't you understand.

Your consideration of what qualifies as "restraint of trade" is so broad that Microsoft could not help but violate it, troll. Any market share or distribution channels that it takes away from rivals could be called restraint of trade in your world; fortunately, cooler heads prevailed. There was no proof that Microsoft explicitly sought to eliminate its rivals from the marketplace. There is a big difference between gaining marketshare and destroying your rivals. Read the Findings of Fact and the Ruling again.

Does it bother your sense of self-esteem that calling me a troll is the most powerful intellectual argument you can muster on your side?

The courts findings of fact are rather lengthy. I did read through it. Your characterization of the findings are a swindle. The findings very much controvert your claims about lack of anti-competitive behavior. In fact it is a catalog full of evidence supporting just that conclusion-which may be just exactly why the Court of Appeals upheld the conviction.

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