Microsoft Says Judge Biased

U.S. racer Tracie Max Sachs, right and Italy's Simone Origone celebrate after winning Speed Skiing World Cup titles in Cervinia, Italy, Monday April 2, 2007.
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Microsoft's lawyers urged a federal appeals court on Monday to reverse a judge's order to break up the computer giant, saying the judge was biased and the government did not prove the company engaged in unlawful conduct.

In a court filing, company lawyers said the Justice Department had conceded that a breakup would not affect Microsoft's position in the market nor end the company's allegedly unlawful conduct.

"This is not the story of a stagnant, dominated industry. … The district court ignored competitive realities that require Microsoft to innovate and price its software attractively," the lawyers said. "Nothing Microsoft did excluded Netscape — the focus of the case — from the marketplace."

The company's brief labeled as "extreme" U.S. District Judge Thomas Penfield Jackson's order last June 7 that the computer giant be broken into two companies.

The U.S. Circuit Court of Appeals for the District of Columbia Circuit is scheduled to hear arguments Feb. 26 and 27 in Microsoft's appeal.

The Justice Department had sought to have the appeal sent directly to the Supreme Court, but the high court turned that plea aside in late September, remanding the case to the appellate court.

Microsoft asked the appeals court to reverse Jackson's ruling. Failing that, the firm's lawyers asked the court to order a new trial before a different judge.

"The district judge's public comments about the merits of the case and his … attacks on Microsoft are indefensible," the company's lawyers said. Such comments, the lawyers said, "demonstrate an animus toward Microsoft so strong that it inevitably infected his rulings."

The Microsoft brief said the author of a new book reported that Jackson compared Microsoft executives to unremorseful gang members convicted of murder and compared company Chairman Bill Gates to Napoleon. The judge also was quoted as saying he trusted Justice Department lawyers.

"It is now apparent from the district judge's public comments that the relief awarded in this case was not a carefully tailored response to the antitrust violations found, but rather an attempt to punish Microsoft for what the district judge termed 'arrogance which derives from power and unalloyed success,"' the computer firm's brief said.

Microsoft's lawyers said Jackson was quoted as complaining that the company's senior officers continued to deny they had done anything wrong.

"It is not an appropriate exercise of judicial power to break up Microsoft because it maintains that its conduct was lawful," the company's brief said. "Nr is the breakup justified because the district judge believes Microsoft's chairman has 'a Napoleonic concept of himself and his company.'"

Justice Department spokeswoman Gina Talamona said, "We are not going to have any comment on the brief." Earlier this month, government lawyers filed a brief that denied Jackson showed bias against the company.

In the Justice Department filing, the government restated its position that the Microsoft matter was "a classic case of monopolization" in which market dominance was used to sustain or extend that power, and said the judge's remarks "demonstrate neither bias nor the appearance of bias."

The government brief filed earlier this month said Microsoft used its overwhelming market share to shut out rivals. Microsoft "deliberately embarked on a multifaceted campaign of anti-competitive conduct to protect its operating system monopoly," the government's Jan. 12 brief said.

The February hearings represent a showdown in the long-running Microsoft antitrust saga — a drama that has boiled down to two main players, the government and the company.

Earlier this month, a federal judge dismissed 38 private antitrust lawsuits against Microsoft, which accused the company of overcharging on its Windows operating system. The judge said the plaintiffs' claims were invalid largely because they hadn't bought their computers directly from Microsoft.

Some observers have questioned whether the Bush administration would continue the lawsuit brought by the Clinton administration, although there would be little time to negotiate a settlement before the appeals court hears argument.

At his confirmation hearing, Attorney General-designate John Ashcroft said it was an important, complex case, adding, "I don't know the facts. I'll have to confer with people in the antitrust division."

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