- The Washington Times - Saturday, June 22, 2002

The Justice Department filed a civil antitrust lawsuit yesterday against the MathWorks Inc. and Wind River Systems Inc., accusing the two companies of entering an agreement that eliminated competition for a software product.

The suit, filed in U.S. District Court in Alexandria, said an agreement between the two companies eliminates important competition for dynamic control-system software products that has led to technical innovation and low price for consumers.

Department lawyers, in challenging the agreement between MathWorks and Wind River, said the pact was a violation of the Sherman Anti-Trust Act.

"High-technology products like these work behind the scenes to help build some of the most sophisticated products in our economy," said Assistant Attorney General Charles A. James, who leads the department's antitrust division.

"This agreement eliminates important competition that has driven significant technical improvements and price reductions for consumers, including major aerospace and automotive companies, engineering firms and governmental entities," he said.

Justice Department officials said Wind River filed a proposed consent decree that would settle the pending suit. The officials said that if the department obtains a judgment that requires divesting the software at issue, Wind River would cooperate.

They said that though Wind River is named a defendant in the suit, it remains a party in the case for the sole purpose of aiding in any judgment against MathWorks. The consent decree requires Wind River to cooperate in the case.

Dynamic control-system-design software enables engineers to develop the computerized control systems of sophisticated devices, such as anti-lock brakes for cars, guidance and navigation control systems for unmanned spacecraft, and flight-control systems for aircraft.

By automating the steps of modeling, analyzing, simulating, testing and generating software code for these types of control systems, engineers can develop them in a shorter time for a lower cost. MathWorks' dynamic control-system software is the Simulink product group. Wind River's competing product is Matrixx.

According to the suit, MathWorks and Wind River, which were direct competitors for the software, entered an agreement last year that ended their competition.

The agreement gave MathWorks the exclusive right to sell Wind River's Matrixx products and required Wind River to stop its development and marketing, department officials said.

The suit says the agreement with Wind River gave MathWorks control over the prices, marketing, support and development of the Wind River dynamic control-system-design tools. MathWorks says it will not further develop the Wind River Matrixx products.

MathWorks is a Delaware corporation with its principal place of business in Natick, Mass. It posted revenue of about $200 million in 2001.

In 2001, department officials said, sales of MathWorks' dynamic control-system-design tools were more than $100 million.

Wind River is also a Delaware corporation, with its principal place of business in Alameda, Calif. Wind River's principal products are embedded operating systems and integrated-development environments.

The firm reported worldwide revenue of $438 million, including $13 million in sales of Wind River's dynamic control-system-design tools.

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