THE MICROSOFT AGREEMENT : Case May Open Era of Global Cooperation
The simultaneous settlements reached Saturday by the U.S. Justice Department and the European Union, respectively, with Microsoft represented an unusual case of close cross-Atlantic cooperation on an antitrust issue and a harbinger of things to come, experts said.
“I can’t think of a case where an American company settled charges simultaneously in America and Europe,” said Richard Donovan, an antitrust attorney with New York-based Kelley, Drye and Warren. “But you are going to see more cases like this in the future.”
Donovan, who represented a fax paper company on a price-fixing case involving a joint U.S.-Canadian investigation, noted that Anne K. Bingaman, head of the Justice Department’s antitrust division, is proposing legislation that would make it easier for the United States to share and exchange evidence with foreign governments.
Justice Department officials disclosed that the United States had been cooperating with the EU over the Microsoft investigation since October. The two governments conducted secret negotiations with Microsoft officials in Brussels during the week of July 4 and last week at the Justice Department.
Both governments had been prepared to go to court Friday to file a lawsuit accusing Microsoft of violating antitrust laws when the company agreed to a settlement.
By working together, the governments were able to gather more evidence than they would have working separately. By threatening charges in two jurisdictions with potentially devastating results, the governments could put more pressure on Microsoft, Donovan said.
At the same time, he said, a joint settlement benefits Microsoft because it does not have to fear that an agreement it reaches with the United States will be used against it as leverage to negotiate even stiffer terms in Europe.
“We are particularly gratified that we were able to settle these issues with the Justice Department and the DG IV (the European equivalent of the U.S. antitrust department) simultaneously and on the same terms,” Bill Gates, Microsoft chairman and chief executive officer, said in a statement.
The two agreements are similar, although the U.S. agreement lasts six years while the European agreement lasts four years.
