Incriminating e-mail alone is not likely to sink Microsoft, antitrust experts said Tuesday.
The government's allegation that Microsoft wielded its Windows monopoly like a club to beat off potential rivals in other markets will turn not only on the veracity of the much-publicized "e-mail trail," but also on the impact on the software market of the company's actions, experts said.
"In antitrust, it all ultimately gets down to what happened in the market," said Stan Liebowitz, a professor of managerial economics at the University of Texas at Dallas and an expert in antitrust law. "The e-mails certainly can help make a case about what the executives were thinking, but in themselves I don't know if they'd prove the company broke the law."
The U.S. Department of Justice and officials from 20 states seized upon e-mails to and from top Microsoft executives in the latest round of their antitrust case against the software behemoth.
In an 89-page document filed late Monday, the government points to statements in the e-mails, such as the now-famous electronic comment by a Microsoft official about "cutting off Netscape's air supply," as proof of the company's anti-competitive practices in the Web browser market.
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'Microsoft has never attempted to divide any market.' -- Microsoft spokesman Mark Murray  |
However, many of the details of the e-mails have been redacted from the version of the document made available to the public. The DOJ and the states agreed not to release certain testimony given in depositions and certain documentation collected, in order to keep competitive secrets from coming to light.
If the e-mails can be proved to have originated from and gone to the parties the DOJ claims, and if a case can be made that harm to Microsoft's competitors referred to in the messages resulted from illegal actions by the company, then the messages could be crucial to the case, said James Castagnera, associate provost at Rider University and author of several books on antitrust law.
'For the jury to decide'
"Justice is raising the e-mail as material facts in the case, but Microsoft disputes whether they constitute material facts, so the judge is likely to say that this is for the jury to decide," Castagnera said.
The DOJ's filing Monday urged the federal judge hearing the case, Thomas Penfield Jackson, not to dismiss it, maintaining there is strong evidence that Microsoft violated antitrust laws.
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'The e-mails certainly can help make a case about what the executives were thinking, but in themselves I don't know if they'd prove the company broke the law.' -- Antitrust expert Stan Liebowitz |
(On Aug. 10, Microsoft had asked Jackson to dismiss the case, contending it failed to meet basic legal standards. On Sept. 8, Microsoft will respond to the Monday filing by again seeking a dismissal of the case, according to a spokesman. Then on Sept. 11, oral arguments are slated to begin in the company's motion for dismissal. Assuming the judge rules that the case should go forward, a trial will start Sept. 23.)
Microsoft officials, meanwhile, responded by repeating earlier assertions that the government's allegations are false, and saying remarks in the latest government filing about CEO Bill Gates' "particular failure of recollection" during his recent deposition were mere "name-calling."
"It seems pretty clear that the government has lost faith in the substance of its case, and is now resorting to name-calling," said Mark Murray, a spokesman for Microsoft's legal team. "In every case, the government has fundamentally misrepresented Microsoft's business relationships. Microsoft has never attempted to divide any market."
While the government's latest filing makes much of Gates' failure to recall certain details in e-mail messages, Murray said attempts to draw conclusions from this are ridiculous.
Other allegations
"Bill gets over 100 e-mails on even the slowest day," he said. "It's not at all surprising that he doesn't remember some of them."
Among the allegations in the DOJ's latest filing:
That Microsoft illegally tried to block Intel, Apple Computer and RealNetworks from entering some segments of the software market, and that the company sought RealNetworks' assurance that it would not share its technology with Microsoft's competitors.
That the software giant tried to cut a deal with Apple to cut off the market for Netscape's browser and for the Java programming language, developed by Sun Microsystems and seen as a possible future threat to Microsoft's desktop dominance.
"Microsoft's dealings with Apple are illustrative of how far Microsoft was willing to go to limit Netscape's opportunities and to stifle Java," the government said. The effort "is particularly telling since Apple represents the main alternative to desktop PCs running ... Windows," according to the filing.
That Microsoft sought to block Apple and Real Networks from marketing their streaming-media software products, which it saw as rivals to its own streaming audio and video platform, and that Microsoft pressured financial software maker Intuit and Intel not to support Netscape's browser.
That Microsoft illegally tried to kill off competition from Netscape by giving its Internet Explorer browser away for free, and by entering into deals with online content partners which required those partners to limit their promotion and/or use of the Netscape browser.
"Because Microsoft believed that it could not win what it repeatedly described as 'the browser war' legitimately and on the merits, it resorted to the predatory and anti-competitive agreements and conduct described," the government said.
Just routine
Murray responded to these allegations by saying any discussions the company had with those firms regarding browser market share or other issues were routine, and that Microsoft never threatened or attempted to bully its business partners.
In its earlier attempt to have the case thrown out, Microsoft said a ruling in its favor in June from a federal appeals court invalidates many of the government's claims. The appellate court had ruled that Microsoft could bundle its Internet browser with the operating system.
