Microsoft ruling: Open the floodgates

Judge Jackson's ruling will bolster other MS antitrust actions -- and may spur even more.

Judge Jackson's searing anti-Microsoft ruling has delighted those involved in private antitrust litigation against the software maker -- and many are scouring the document with plans to incorporate it into their case.

"As soon as the opportunity presents itself, we'll attach it to something and send it to the judge [in our case]," said Gene Crew, an attorney for Townsend, Townsend & Crew, who's pursuing a class-action antitrust case against Microsoft in California. "I can't wait."

In an opinion issued Friday -- the first major decision in the antitrust suit against Microsoft -- Jackson determined Microsoft to be an abusive monopolist that tried to quash competition in order to illegally maintain market share. The ruling could save private individuals and companies time and money as they argue Microsoft is a monopoly, and also spark some new suits.

Crew, who is suing Microsoft in California Superior Court on behalf of many of the state's consumers who've purchased Microsoft operating systems and applications, thinks the ruling will make it difficult for Microsoft to defend itself against charges it's not a monopolist. "Microsoft is bound by the findings of this court in other party's actions against it," Crew said.

Software companies suing Microsoft for antitrust violations also praised Jackson's finding and hope it will boost their efforts against the company. Attorney Mladen D. Kresic, who's representing software maker Bristol Technologies, said Jackson's opinion could be ammunition in an effort to reopen Bristol's case against Microsoft. In July a jury ruled against Bristol, finding that Microsoft didn't violate federal antitrust law by nearly quadrupling the prices it charged Bristol for Windows source code. That jury also never defined a relevant market in the case. But Kresic said he might cite Jackson's ruling -- and the fact that it spells out a relevant market -- in an effort to convince the judge to toss out the jury's decision.

"We're still looking at it," Kresic said. "To a great extent, what we were arguing was vindicated by this decision by Judge Jackson." Meanwhile, Bryan Sparks, founder and president of Caldera subsidiary Lineo, thinks the ruling will make it easier to convince a judge that Microsoft has a monopoly, as his company tries to prove Microsoft maintained market share through illegal means. "Judge Jackson had a finding of fact that said they do have a monopoly," Sparks said. "If the judge has already done that, it makes it easier for us."

Caldera filed suit in federal court in Utah in 1996, alleging that Microsoft violated antitrust law by, among other things, illegally discouraging the purchase of rival products including Caldera's. The suit goes back farther than the DoJ's, but Sparks hopes Jackson's ruling will apply in "time frames that overlap" both cases. The Caldera case is scheduled to go to trial in January.

The part of Jackson's ruling that deals with Microsoft's market share is probably the most useful to companies and people pursuing private antitrust action against the company. Herbert Hovenkamp, an antitrust expert and law professor at the University of Iowa said nearly half of a plaintiff's resources go toward trying to prove that a company is a monopolist. Now, plaintiffs can point to Jackson's decision, without presenting their own case -- provided Jackson's ruling stands.

Hovenkamp said Jackson's finding could be withdrawn as a condition of a settlement between Microsoft and the U.S. Department of Justice, which, along with 19 state attorneys general, is suing the company for antitrust violations. As a result, he said, most companies suing Microsoft would like to see the case remain in court instead of settling. "They would like to have a fully litigated suit," he said.

John Soma, a law professor at University of Denver College of Law and trial attorney for the DoJ in its case against IBM, said the landmark antitrust case already has been a great boon for those pursuing private antitrust cases. The government has uncovered documents and testimony of Microsoft's strong-arm tactics that small companies and firms might not have the time or resources to unearth. Now, Jackson's opinion has endorsed that testimony as fact in the public record, where plaintiffs in other cases can cite it.

"From a plaintiff's perspective, they have overcome a huge hurdle," Soma said. He predicted the ruling also could open up Microsoft to more antitrust action. "I'm sure we're going to find some private plaintiffs suing now based on this," he said.

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