Microsoft Fails to Find Defense in Deposition
Microsoft Corp.’s hopes of uncovering a smoking gun in the America Online-Netscape merger went unrealized Wednesday after nearly three hours of questioning of a Netscape executive.
Reviving action in Microsoft’s antitrust trial with the government, Microsoft lawyer Michael Lacovara deposed Netscape Executive Vice President Peter Currie in an unusual public proceeding in a downtown Washington hotel as an audience of about 60 reporters and observers looked on.
Lacovara’s questioning attempted to show that America Online’s recent purchase of Netscape--marrying the world’s largest Internet access provider with one of the leading makers of Internet software--undermines the government’s claims that Microsoft has no serious competition in the software business or on the Internet.
The session was the first in a series of depositions scheduled over the next two weeks involving three executives who helped put together the $9.9-billion blockbuster purchase of Netscape by AOL, which also involved Sun Microsystems as an AOL partner. Microsoft is gathering evidence for the rebuttal phase of the trial, set to resume next month.
Microsoft had seized on the AOL deal as a potential legal defense after U.S. District Judge Thomas Penfield Jackson mused in court last winter about whether the deal would affect the competitive landscape in the software industry.
Although trial witnesses are normally deposed behind closed doors, most of Currie’s questioning, except for a 10-minute portion dealing with confidential business matters, was open to the public following a recent appellate court ruling upholding an obscure 1913 law allowing public attendance at certain depositions in antitrust cases.
Lacovara quizzed Currie about the finances, timing and circumstances of Netscape’s deal with AOL. Currie said Netscape has had frequent contact with AOL over the years but that Netscape’s discussions about being acquired by AOL started only in late August and turned serious in late September.
Lacovara also asked Currie when the Justice Department learned about the deal, suggesting that if the government had any advance knowledge of the transaction it could affect the case.
“I don’t know when the Justice Department was informed,” Currie said.
David Boies, the lead attorney for the government, said the Justice Department did not learn of the AOL-Netscape deal until near its announcement in November. “I don’t think the witness was of very much help to Microsoft,” he said.
On Friday, Microsoft lawyers will question Sun Microsystems Vice President Mike Popov, followed by AOL Chairman Steve Case next Thursday.
Microsoft’s landmark trial with the Justice Department, 19 states and the District of Columbia has been in recess since early March to allow Jackson to oversee an unrelated criminal trial. The earliest the Microsoft trial could resume is May 17.
