Microsoft Makes Antitrust Settlement Offer - InformationWeek

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Microsoft Makes Antitrust Settlement Offer

Microsoft on Friday faxed the Justice Department a proposal to settle its antitrust case after the trial judge warned he would deliver a verdict this week unless mediation talks progressed.

Government lawyers were reviewing the proposal--described as detailed and technically complex--late this afternoon, according to reports. It was unclear whether the faxed document would lead to face-to-face settlement talks during the weekend between the two sides and a court-appointed mediator, Richard Posner, chief judge of the U.S. Court of Appeals for the Seventh Circuit in Chicago. Spokespeople for Microsoft and the Department of Justice declined to comment on any talks and would not confirm such a proposal was sent.

U.S. District Court Judge Thomas Penfield Jackson, who is presiding over the trial, told both sides he could issue a verdict as early as Tuesday unless they moved closer to a settlement. Microsoft and the Justice Department have been secretly meeting with Posner since Jackson appointed the mediator last fall. Jackson is likely to find Microsoft guilty, at least in part. His findings of fact concurred with the Justice Department's charges that Microsoft wielded a monopoly, abused its dominance to exclude competition, and reduced innovation.

Joel Klein, the Justice Department's antitrust chief, told a Senate committee last week that remedies for Microsoft's conduct should be "commensurate with those practices" a federal judge enumerated in November. Yet some reports have indicated that government lawyers are backing away from proposals to restructure Microsoft in favor of remedies that address the company's behavior.

"You would think there would be lots of incentives to settle," says Bill Whyman, an Internet analyst at Legg Mason Precursor Group. "But it remains extremely difficult to say what Joel Klein and Bill Gates could both sign."

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