U.S. Urges Against Microsoft Review

The Justice Department urged the U.S. Supreme Court to stay out of the Microsoft Corp. antitrust battle, arguing that the Court of Appeals--which found the company liable for violating antitrust laws--is in a better position to judge the case, according to court papers filed Friday.

Responding to Microsoft’s Aug. 7 appeal to the Supreme Court, antitrust officials said granting the company a new trial would unfairly punish the government, cost taxpayers millions of dollars and create uncertainty in the markets.

“The Court of Appeals properly balanced the risk of injustice to the parties in this case,” the government said in its 26-page filing.

The government also argued that Microsoft has mischaracterized the June 28 appeals court ruling and urged the Supreme Court to hold off on any review until after the case is completed. Both sides are expected to return to federal court Sept. 21 for the final phase of the trial.

Microsoft is asking the Supreme Court to throw out the case because U.S. District Judge Thomas Penfield Jackson, who presided over the trial, violated judicial ethics by holding secret meetings with reporters. Though the appeals court found no evidence of actual bias, it said the appearance of impropriety was serious enough that Jackson should be disqualified from the case and his breakup order set aside.

Microsoft says the appeals panel should have gone further, vacating Jackson’s findings of fact and final judgment.

On Friday, the Justice Department--working with 18 state attorneys general--defended the appeals court’s unanimous decision, noting that the judges spent an hour discussing Jackson’s misconduct at the February hearing and devoted 20 pages of its 125-page ruling to the subject.

“The Court of Appeals clearly was troubled by the trial judge’s misconduct and gave the issue its utmost consideration,” government attorneys said in their filing. They said the Supreme Court had ruled that judicial misconduct cases are best handled by the appeals court.

Microsoft officials said Friday that their appeal was on solid legal grounds.

“This is an important issue that goes to the very heart of judicial integrity,” Microsoft spokesman Jim Desler said. “It’s fundamental to the public confidence in the trial process.”

The company has said that if it had known about Jackson’s secret meetings with reporters--which began as early as September 1999--it would have immediately demanded a mistrial. As a result, the company says all court proceedings after September 1999 should be vacated, including the findings of fact and final judgment.

Government attorneys said the trial was completed in June 1999, before the first known interviews with Jackson.

Though the initial interviews were secret, Jackson allowed his comments--which were highly critical of Microsoft--to be published last year after his ruling was issued.

The government filing also said Microsoft incorrectly asserts that the appeals court ruling stated that Jackson’s findings could not be overturned unless the company showed actual bias on his part, rather than just the appearance of bias. Microsoft says such a ruling conflicts with other court decisions, thereby increasing the chances that the Supreme Court might step in to clarify.

The government and the appeals court say Microsoft simply got it wrong. “[T]he decision says nothing of the kind,” the government filing stated, noting that the court treated the absence of actual bias as one factor in its decision.

In its denial of Microsoft’s request to delay the case last month, the appeals court took a rare swipe at the company, saying Microsoft misconstrued its ruling.

“We stand by our filing,” Desler said.