eanax
09-06-2001, 11:38 AM
U.S. Abandons Microsoft Breakup Effort
Thursday September 6 11:17 AM ET
By Peter Kaplan
WASHINGTON (Reuters) - The U.S. Justice Department (news - web sites) said on Thursday it was no longer seeking the breakup of Microsoft Corp. and would strive to find a remedy in the three-year old case ``as quickly as possible.''
In a statement that initially pushed the technology giant's shares higher, the department said it would also not pursue an unresolved claim that the company illegally tied its Internet Explorer browser to its Windows operating system.
``The Department of Justice (news - web sites)'s Antitrust Division today advised Microsoft that it will not seek a break-up of the company in remand proceedings before the U.S. District Court,'' the statement said.
Instead, the department said it will pursue a remedy ''modeled after the interim conduct-related provisions of the final judgement previously ordered in the case.''
The announcement came as the Justice Department and Microsoft try to work out a proposal on how further proceedings should be structured.
``The department is seeking to streamline the case with the goal of securing an effective remedy as quickly as possible,'' it added.
After an initial boost, Microsoft stock fell as the market digested the news, despite the views of analysts that the department's decision was a positive development for the company.
``I'm a little surprised at the stock move,'' said Parker/Hunter analyst Kimberly Caughey. ``I wouldn't say that it removes the dark cloud from over Microsoft, because anything could happen in settlement talks. But it makes that cloud a little less threatening,'' she said.
A Microsoft spokesman said only that company officials ''remain committed to resolving the remaining issues in this case.''
The new judge assigned to handle the Microsoft case, U.S. District Court Judge Colleen Kollar-Kotelly, last month ordered the parties to report on the remaining issues in the legal battle by Sept. 14 and scheduled a meeting on the status of the case for Sept 21.
Kollar-Kotelly will hold hearings to decide what sanctions to impose on the software giant to prevent future abuse of its monopoly in personal computer operating systems.
She had also been set to consider whether the company violated the law by tying its Internet Explorer browser into the Windows operating system.
The department said today that pursuing that claim ``would only prolong proceedings and delay the imposition of relief that would benefit consumers.''
``In view of the Court of Appeals' unanimous decision that Microsoft illegally maintained its monopoly over PC-based operating systems -- the core allegation in the case -- the department believes that it has established a basis for relief that would end Microsoft's unlawful conduct, prevent its recurrence and open the operating system market to competition,'' the department said.
The U.S. Justice Department and 18 states' attorneys general suing Microsoft had asked Kollar-Kotelly to accelerate the proceedings by convening a meeting of the parties, potentially in the next 10 days.
The U.S. Court of Appeals for the District of Columbia in June upheld another district court judge's ruling that Microsoft holds a monopoly in the PC operating systems market and used illegal tactics to defend it.
However, the appeals court reversed Judge Thomas Penfield Jackson's order that Microsoft be split in two as an appropriate remedy for the violations.
Thursday September 6 11:17 AM ET
By Peter Kaplan
WASHINGTON (Reuters) - The U.S. Justice Department (news - web sites) said on Thursday it was no longer seeking the breakup of Microsoft Corp. and would strive to find a remedy in the three-year old case ``as quickly as possible.''
In a statement that initially pushed the technology giant's shares higher, the department said it would also not pursue an unresolved claim that the company illegally tied its Internet Explorer browser to its Windows operating system.
``The Department of Justice (news - web sites)'s Antitrust Division today advised Microsoft that it will not seek a break-up of the company in remand proceedings before the U.S. District Court,'' the statement said.
Instead, the department said it will pursue a remedy ''modeled after the interim conduct-related provisions of the final judgement previously ordered in the case.''
The announcement came as the Justice Department and Microsoft try to work out a proposal on how further proceedings should be structured.
``The department is seeking to streamline the case with the goal of securing an effective remedy as quickly as possible,'' it added.
After an initial boost, Microsoft stock fell as the market digested the news, despite the views of analysts that the department's decision was a positive development for the company.
``I'm a little surprised at the stock move,'' said Parker/Hunter analyst Kimberly Caughey. ``I wouldn't say that it removes the dark cloud from over Microsoft, because anything could happen in settlement talks. But it makes that cloud a little less threatening,'' she said.
A Microsoft spokesman said only that company officials ''remain committed to resolving the remaining issues in this case.''
The new judge assigned to handle the Microsoft case, U.S. District Court Judge Colleen Kollar-Kotelly, last month ordered the parties to report on the remaining issues in the legal battle by Sept. 14 and scheduled a meeting on the status of the case for Sept 21.
Kollar-Kotelly will hold hearings to decide what sanctions to impose on the software giant to prevent future abuse of its monopoly in personal computer operating systems.
She had also been set to consider whether the company violated the law by tying its Internet Explorer browser into the Windows operating system.
The department said today that pursuing that claim ``would only prolong proceedings and delay the imposition of relief that would benefit consumers.''
``In view of the Court of Appeals' unanimous decision that Microsoft illegally maintained its monopoly over PC-based operating systems -- the core allegation in the case -- the department believes that it has established a basis for relief that would end Microsoft's unlawful conduct, prevent its recurrence and open the operating system market to competition,'' the department said.
The U.S. Justice Department and 18 states' attorneys general suing Microsoft had asked Kollar-Kotelly to accelerate the proceedings by convening a meeting of the parties, potentially in the next 10 days.
The U.S. Court of Appeals for the District of Columbia in June upheld another district court judge's ruling that Microsoft holds a monopoly in the PC operating systems market and used illegal tactics to defend it.
However, the appeals court reversed Judge Thomas Penfield Jackson's order that Microsoft be split in two as an appropriate remedy for the violations.