Microsoft Judge Sets Jan. 7 Hearing on Timing

WASHINGTON – A federal judge Wednesday scheduled a hearing for Monday on whether to grant Microsoft Corp.'s request to delay hearings on what antitrust remedy should be imposed on the company.

In a motion filed Dec. 21 with U.S. District Court Judge Colleen Kollar-Kotelly, Microsoft had argued that it needed more time to prepare because nine states in the case were seeking a "dramatic expansion" of possible sanctions.

The nine states that have rejected a proposed settlement reached between the company, the U.S. Justice Department, and nine other states, have argued against any delay.

Under the original timetable, laid out by the judge three months ago, the remedy hearings were set to begin March 11. Tunney Act hearings into whether the proposed settlement is in the public interest are due to be held around the same time.

The timing of these separate hearings could be crucial to the outcome of the case that is approaching its fourth year.

Legal experts have said approval of the settlement, far in advance of hearings on further remedies, would make the dissenting states' effort much more difficult.

An appeals court in June upheld findings that the company violated antitrust law by illegally maintaining its monopoly in personal computer operating systems. But it rejected breaking up the company as a remedy for the illegal acts.

The proposed settlement would require Microsoft to take steps to give computer makers more freedom to feature rival software on their machines and share parts of the inner workings of Windows with other software makers.

But the nine dissenting state attorneys general say the settlement is inadequate, and have asked Kollar-Kotelly for tougher sanctions against the company for illegally maintaining its monopoly in personal computer operating systems.

These states want Kollar-Kotelly to order Microsoft to sell a cheaper, stripped-down version of its Windows operating system and give competitors access to the inner workings of the Internet Explorer browser.

In addition, the hold-out states want the judge to ensure that Microsoft Office, the popular business software, will be compatible with other software platforms.

Microsoft has told Kollar-Kotelly that the schedule "should be amended in view of the non-settling states' dramatic expansion of the scope of the litigation beyond what the court reasonably could have anticipated three months ago."

But the hold-out states urged the judge in a filing Monday not to delay the remedy hearings, saying Microsoft had plenty of warning they would likely seek broad conduct remedies.