In a 125-page decision, the US Court of Appeals for the District of Columbia Circuit upheld a previous ruling that Microsoft used illegal conduct to retain its OS monopoly and asked a trial court to determine an appropriate remedy. The appeals court also asked the trial court to revisit the controversial issue of tying products such as the browser to Microsoft's ubiquitous PC operating system.
"I am pleased to say that the court unanimously found that Microsoft engaged in unlawful conduct to maintain its dominant position in computer operating systems," said US Attorney General John Ashcroft. "This is a significant victory."
However, in a crucial win for Microsoft, the appeals court said the trial judge, Thomas Penfield Jackson, "seriously tainted the proceedings." It removed him from the case and tossed out his order calling for the breakup of the software titan.
In addition, the court threw out a claim that Microsoft attempted to extend its monopoly to the browser market.
Microsoft Chairman Bill Gates described the ruling as positive and said it could lead to a settlement with the government.
"With this ruling there is a new framework, and so it would be a good time for all parties involved to sit down together," he said at a press conference at the company's headquarters.
Sorting out the real winner depends on what the expectations were for the appeals court. In that regard, Microsoft is likely to be more disappointed in the split decision.
Mixed results
For the past several weeks, many analysts and some Microsoft executives had anticipated a fairly sweeping victory. As a result, being labeled an abusive monopolist and having the tying issue remain unresolved is considered a loss.
On the other hand, the elimination of the breakup order and judge Jackson are important wins.
"I don't think this was a very good ruling for Microsoft," said Andy Gavil, an antitrust professor with Howard University School of Law. "I've heard Microsoft is trying to claim some victory out of it, but I don't see a lot of victory for them."
Thursday's decision came almost exactly a year after Jackson ruled that Microsoft violated antitrust laws by exploiting its monopoly in the market for operating systems to capture the market for Web browsers.
