Justice Withdraws Disputed Subpoena in Microsoft Probe : Computers: Department says it already has enough information to decide whether to proceed with its antitrust case.
Indicating that its probe of Microsoft Corp.’s upcoming on-line service is near completion, the Justice Department on Friday withdrew a disputed subpoena and said it already has enough information to decide whether to proceed with an antitrust case against the software giant.
The department has been investigating whether Microsoft’s packaging of the access software for the upcoming Microsoft Network with the new Windows 95 personal computer operating system is a violation of antitrust laws. The department is under pressure to act quickly because Windows 95 goes on sale Aug. 24.
Earlier this month, the Justice Department issued a subpoena requesting a broad array of information from Microsoft, but the software company asked a federal court to block the request. On Friday, Assistant Atty. Gen. Anne K. Bingaman said the government was withdrawing the subpoena because it doesn’t have time for a procedural skirmish.
“It is apparent that the government will have to make its decision as to whether to initiate an enforcement action prior to the launch date on the basis of the other evidence we have gathered to date both from Microsoft and from third parties,” Bingaman told U.S. District Court Judge Robert J. Ward in a two-page letter dated July 21.
A hearing on the disputed request for documents had been scheduled for Monday.
Antitrust experts on Friday read the Justice Department decision as a signal that the agency may now be preparing to challenge the Microsoft Network.
The heads of the three leading on-line services--CompuServe, America Online and Prodigy--all said they received information requests from the department within the past week concerning how much they pay computer manufacturers to install software on new computers providing access to their services--an indication, they said, that federal officials are still aggressively pursuing their options.
Bringing an antitrust case against Microsoft would be “a massive undertaking and the Justice Department can’t be caught up in side fights” over small procedural issues, said Washington antitrust lawyer Garret Rasmussen. What Friday’s decision means, he added, “is that the Justice Department is marshaling its forces.”
But representatives of some of Microsoft’s on-line rivals say the department’s strategy remains unclear.
“I was really surprised when they dropped their” civil subpoena of documents from Microsoft, said Donald I. Baker, a Washington antitrust lawyer who represents CompuServe.
“But I really don’t think it tells you anything much about whether they are going to bring a case or not,” he said.
If it decides to act against Microsoft, the Justice Department in all likelihood will seek a preliminary injunction forcing the company to remove the network software from Windows 95--a step that gets more expensive and difficult as the shipping date approaches.
“The more expense Microsoft has gone to, the higher the burden for the government” to secure an injunction, Rasmussen said. On the other hand, he said, the Justice Department has to take the time necessary to make certain it has a strong case against Microsoft.
“If an injunction is issued, it is going to create havoc for Microsoft,” Rasmussen said.
Microsoft spokeswoman Erin Carney said the company wasn’t sure how to read the government’s maneuvering.
“We filed the petition to seek relief from the request and we have gotten” relief, she said. “We can’t speculate on what their next move will be.
“But we feel from a legal and business perspective that including the access code for the Microsoft Network in Windows 95 is entirely pro-competitive,” Carney said.
