- The Washington Times - Thursday, June 20, 2002

An attorney for Microsoft Corp. declined to embrace any of the proposed penalties outlined by the group of states pressing for tougher sanctions against the Redmond, Wash., software company.
"Our proposal is what it is and in that respect, we don't want any variation," John Warden, the lead attorney for Microsoft, said as the hearing came to a close.
The proposal by the states "is fundamentally flawed," he said. "We can't remedy any of this by changing a few words here and there."
Mr. Warden's remarks stemmed from a judicial request. In an apparent search for middle ground, U.S. District Judge Colleen Kollar-Kotelly asked attorneys for Microsoft and the group of states pushing for tougher penalties to tell her which of their own sanctions are most important and which sanctions proposed by their rivals they consider least onerous.
Microsoft reached a settlement with the Justice Department and another group of states last November on proposed sanctions to punish the company. But a group of nine states and the District of Columbia rejected that proposal and are pressing for stiffer penalties.
Mr. Warden and Microsoft attorney Dan Webb each said the Justice Department proposal offers the fairest list of restrictions.
Steven Kuney, an attorney representing the states, told the judge any remedy she comes up with must include a requirement that Microsoft disclose technical data to software developers, which is the most important element in their own proposed penalties. That information is intended to help Microsoft competitors ensure their software is compatible the Windows operating system.
Mr. Webb argued that the states' proposed penalties should be rejected because Microsoft competitors, including AOL Time Warner Inc. and Sun Microsystems, had a hand in drafting the sanctions.
"No one expects Microsoft's competitors to be fair to them," Mr. Webb said.
A court of appeals upheld a lower court's finding last year that Microsoft was guilty of anti-competitive behavior. But it reversed an order from U.S. District Judge Thomas Penfield Jackson that Microsoft be broken into two companies, and appointed Judge Kollar-Kotelly to hold another hearing and determine Microsoft's punishment.
The end of the hearing yesterday brings to a close the latest phase of the lengthy trial, which began in 1998. Penalty hearings stemming from the states' request for stricter sanctions began March 18 and included 33 witnesses.
The final day of the hearing yesterday included little new information; attorneys simply reiterated long-held positions.
States' attorney Brendan V. Sullivan said Microsoft was motivated by fear, but the scope of their misconduct was extraordinary, he said.
Microsoft used its leverage to threaten an Apple Computer official by saying it would not let the company install its Windows operating system on Apple computers if it continued talking to Microsoft rivals.
"They really are thuggish-like tactics," Mr. Sullivan said. "It's surprising that someone like [Microsoft Chairman and founder Bill] Gates would let it happen. When executives of this caliber make threats like that, I find it mind-boggling."
Mr. Sullivan said the judge may be the last person left who can tell Microsoft "how it must behave," and he told Judge Kollar-Kotelly her decision in the case will be historic.
Judge Kollar-Kotelly is expected to make a decision later this year.
California, Connecticut, Florida, Iowa, Kansas, Massachusetts, Minnesota, Utah, West Virginia and the District of Columbia are pressing for tougher penalties.


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