No Rush on Microsoft, U.S. Tells Court

The government on Friday asked the U.S. Court of Appeals to ignore Microsoft Corp.’s urging to begin work on the firm’s appeal as the legal tennis match in the antitrust case continued.

The Justice Department and states suing Microsoft said the software giant was wrong in asserting that the states’ case would be split off and remain with the appeals court in Washington even if the Supreme Court agreed to hear the federal case directly.

The government brief also repeated arguments that the appeals court should defer any action on Microsoft’s request to stay a breakup order against the company until District Judge Thomas Penfield Jackson has ruled on the firm’s stay request.

Since Jackson issued his order June 7 to split Microsoft in two to prevent future antitrust violations, both sides have jostled to go before the higher court of their choice.

Microsoft, knowing that the Court of Appeals had previously overturned Jackson in a related Microsoft matter, has been trying to ensure its appeal goes there first.

But the government side, arguing that the case is of national economic importance, is asking for a direct hearing by the Supreme Court under a mechanism available in major antitrust cases.

Microsoft warned Friday there could be a material impact on its stock if it does not get sufficient legal relief through a stay of a court order to split the company or a successful appeal, or both.

“The failure to obtain sufficient relief through the stay and/or the appeal could have a material adverse effect on the value of Microsoft’s common stock,” the Redmond, Wash.-based company said in a Securities and Exchange Commission filing.

Microsoft shares closed Friday up 19 cents at $72.56 on Nasdaq before the company issued its warning. In the last 52 weeks, the stock has traded as high as $119.94 but has been battered as low as 60.38 on its legal woes and on general tech stock weakness.