Justice Dept. Drops Microsoft Breakup Request
N E W Y O R K, Sept. 6 -- Marking a dramatic change of strategy in its long-standing antitrust case against Microsoft, the Justice Department announced today it will no longer seek a breakup of the world's largest software company.
Rather than break up the company into separate operating systems and applications businesses, the Justice Department said the government will pursue restrictions on Microsoft's business practices to "obtain prompt, effective and certain relief" for consumers.
The decision eradicates any possibility that the software giant could be chopped in half. That was the penalty assessed the company in a dramatic ruling in June 2000 by District Court Judge Thomas Penfield Jackson.
In June of this year, an appeals court overturned Jackson's breakup order and removed him from the case, ordering a different judge to assess a penalty to the company. But the court upheld Jackson's initial ruling, in 1999, that Microsoft had illegally taken advantage of its monopoly in the software market.
The DOJ memo says that because the appeals court upheld Jackson's ruling on the abuse of the software monopoly, the department "believes it has established a basis for relief that would end Microsoft's unlawful conduct."
District Court Judge Colleen Kollar-Kotelly has since been assigned to the four-year-old case. The initial lawsuit against was Microsoft was filed in October 1997.
‘Bundling’ Also Out the Window
Additionally, the DOJ has announced that it will no longer seek to prove that Microsoft had illegally "bundled" its Internet Explorer browser with its Windows 95 operating system — a key part of the original case.
"Pursuing a liability determination on the tying claim would only prolong proceedings and delay the imposition of relief that would benefit consumers," the Justice Department explained in its announcement.
That means Microsoft's new Windows XP operating system, which integrates a variety of new offerings, will not be subject to legal scrutiny on the "bundling" issue.
