Court Date Puts Microsoft Antitrust Suit on Fast Track

The Justice Department’s landmark antitrust suit against Microsoft Corp. moved onto the fast track Friday as a federal judge set a Sept. 8 trial date for the controversial case, short-circuiting the company’s effort to delay the proceedings.

Also slated for that date is a hearing on a government-sought injunction that would order Microsoft to separate its Internet Explorer Web browser from its new Windows 98 program so computer makers can choose between it and a rival program from Netscape Communications Corp. Microsoft plans to release its new operating system software June 15.

Although the decision means that Microsoft can release Windows 98 with its own Internet browser technology intact--at least through Sept. 8--it also sidetracks the company’s hopes of delaying the trial until it has captured the bulk of the market.

Microsoft had argued for a seven-month delay in the start of the trial, saying that it needed the extra time to respond to the government’s request for a preliminary injunction. But U.S. District Judge Thomas Penfield Jackson said he thought the Sept. 8 date would suffice.

The decision marked a victory for the Justice Department, which had been pressing for an early hearing on the injunction and a speedy trial date. Jackson also consolidated the federal suit with separate cases brought by 20 state attorneys general, including California’s.

Robert A. Litan, a former Justice Department official now with the Brookings Institution, said government antitrust lawyers “must be breaking out the champagne” in the wake of Friday’s ruling. “This goes far beyond the government’s wildest dreams,” he added.

The case is regarded as a landmark antitrust suit because it goes to the heart of the way Microsoft does business, imposing restrictions on the uses of its software that the Justice Department says are designed to snuff out competitors.

Government antitrust lawyers had hoped to obtain a preliminary injunction by June 25, the date Microsoft had said originally that it hoped to begin selling Windows 98 to the public, but they conceded on Friday that a few weeks’ delay would not make much difference.

Microsoft attorneys disclosed Friday that the company now plans to begin marketing Windows 98 on June 15, shipping about 2 million copies of the program each month to retail stores around the country.

Microsoft had proposed a schedule that would have pushed any hearing on whether to grant the preliminary injunction to sometime in December, with the trial to take place several weeks or months after that. Under the new schedule, the entire trial could be over by mid-autumn.

Both federal and state antitrust lawyers said they were pleased by the judge’s ruling. Richard Blumenthal, attorney general of Connecticut, one of the states that has joined in the federal suit, said the decision “puts us on a very fast track.”

The antitrust suits, filed last Monday, allege that Microsoft has engaged in a pattern of predatory conduct aimed at maintaining a virtual monopoly in software. Microsoft has denied the allegations and has charged that the government is interfering with its right to invent and exploit creative new software products that benefit consumers.

The government’s complaint about the Windows 98 program is that Microsoft has required computer makers to sign contracts prohibiting them from removing Microsoft’s own browser technology from each copy of Windows 98 that they install or from erasing its icon from the desktop.

Officials say the restrictions effectively prohibit Netscape from competing against Microsoft with its Navigator Web browser. Users of Windows 98 can install Netscape in their computers.

Windows 98 is being sold as the successor to Windows 95, an earlier version of the program that officials say has captured some 90% of the market.

The schedule set on Friday was designed to enable Microsoft to launch Windows 98 as scheduled, while still enabling the court to decide the case before the Christmas selling season, which is a major marketing time for computer makers.

The schedule set by the judge on Friday was speedy by antitrust standards. It took the Justice Department 13 years to prosecute IBM Corp. on antitrust charges, and even then it failed. By that time, however, the case was all but moot.

Litan said Friday that although Microsoft has won the right to market its new Windows 98 program intact, it will have to revamp the software it has sold if the government wins its case in September. He said any program sold this summer “could become a collector’s item.”

Besides the Sept. 8 trial date, Jackson also set the following schedule: a July 28 deadline for Microsoft to respond to the government’s complaint, an August 10 due date for the company to comment on the preliminary injunction, and an August 24 date for the government to reply.