- The Washington Times - Wednesday, March 27, 2002

A Microsoft lawyer asserted yesterday that a key witness for states seeking strong antitrust penalties against the software giant is biased against the company.
Dan Webb, representing Microsoft in the U.S. District Court penalty hearing, said former Intel executive Steven McGeady showed that he "personally detested" Microsoft when he referred to the company as an "evil corporation" in a magazine interview.
Previous testimony in the antitrust case included charges that Microsoft had threatened Intel in 1995 to stop it from developing its own multimedia software, a project that was headed at the time by Mr. McGeady.
"You do personally harbor an intense dislike for my client, Microsoft?" Mr. Webb asked McGeady.
"I have tried to portray Microsoft's corporate culture and business practices that I don't believe align with a company of their stature," Mr. McGeady replied. "I am quoted as saying all sorts of things that probably should have gotten my mouth washed out with soap."
The software Intel was developing in 1995 would have helped computers receive audio and video without interruption. Microsoft threatened to withhold support for new Intel microprocessors until Intel abandoned the effort.
Mr. McGeady testified on behalf of nine states that want U.S. District Judge Colleen Kollar-Kotelly to force Microsoft to create a stripped-down version of its flagship Windows software that could incorporate competitors' features. The states also want Microsoft to divulge the blueprints for its Internet Explorer browser.
The federal government and nine other states settled their antitrust case against Microsoft last year for lesser penalties.
The original judge in the case, Thomas Penfield Jackson, ordered Microsoft broken into two companies after concluding it illegally stifled its competitors. An appeals court reversed the penalty, but not the conviction, and appointed Judge Kollar-Kotelly to determine a new punishment.
Judge Kollar-Kotelly has offered the federal government a chance to say whether it believes the nine states have the right to ask for penalties at all.
The government has until April 15 to respond to the offer, which could pit the Bush administration against state governments. The nine states have repeatedly said they believe the administration settlement is toothless.
Microsoft has asked the judge to dismiss the states' suit, arguing that only the federal government can seek nationwide penalties. The nine states, as well as more than 20 states that are not parties to the Microsoft suit, oppose the motion.
States pursuing the tougher antitrust penalties are Iowa, Utah, Massachusetts, Connecticut, California, Kansas, Florida, Minnesota and West Virginia, along with the District of Columbia.
Earlier yesterday, Microsoft lawyers disputed a Gateway executive's claim that Microsoft had threatened Gateway when the computer maker complained about its contracts with Microsoft.
Microsoft executive Richard Fade had told Gateway the contracts were nonnegotiable and Mr. Fade didn't want to see his comments "showing up at the [Justice Department] or in the courts."
"Mr. Fade's comments, including that one, I perceived as a threat of retaliation," Gateway executive Anthony Fama said.

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