Judge orders Microsoft breakup

U.S. District Judge Thomas Penfield Jackson, after two years of hearing the antitrust case against Microsoft Corp., on Wednesday lambasted the company for failing to recognise it broke the law.

He accompanied his main order to break up the company into two and impose limitations on future business practices with an excoriating six-page memorandum that labelled the company “untrustworthy.” Jackson ridiculed Microsoft for seeking essentially a second trial to examine the merits of breaking up the company as a remedy to prevent future abuse of its monopoly in the personal computer operating system market. “From the inception of this case Microsoft knew, from well-established Supreme Court precedents dating from the beginning of the last century, that a mandated divestiture was a possibility, if not a probability, in the event of an adverse result at trial,” Jackson said.

A structural remedy had become “imperative” and the company’s proposed alternative of limited restrictions on its business practices was “plainly inadequate,” Jackson wrote. “Microsoft proved untrustworthy in the past,” he said. “Microsoft as it is presently organised and led is unwilling to accept the notion that it broke the law or accede to an order amending its conduct,” he said. The breakup plan is designed to “terminate the unlawful conduct, to prevent its repetition in the future, and to revive competition in the relevant markets,” the federal judge said. Jackson said the company had shown no willingness to voluntarily change its business practices in any significant way to remedy the situation. “Indeed, it has announced its intention to appeal even the imposition of modest conduct remedies it has itself proposed as an alternative to non-structural remedies” sought by the government, Jackson wrote. In a rare interview with the Washington Post, Jackson said he had little choice but to accept the proposal of the Justice Department and the states because he wanted to avoid establishing a conduct-restraining order that required an onerous regulatory scheme. He said he would have preferred allowing market forces to accomplish the remedy. Reuters