Tuesday, March 30, 1999

Microsoft balks at turning over system blueprints

More talks today on technical remedies

The Associated Press

        WASHINGTON — On the eve of secret negotiations in an effort to settle antitrust charges, Microsoft bristled Monday over indications that it might be asked to surrender the lucrative blueprints for its Windows operating system.

        “There are laws in this country that protect the copyright of all companies that create intellectual property,” spokesman Greg Shaw said.

        Microsoft was expected to meet here today with lawyers from the Justice Department and 19 states suing it over alleged antitrust violations. Both sides are under orders from a judge to negotiate, although experts agree that any settlement is unlikely.

        The trial, in a lengthy recess, is tentatively scheduled to resume April 12 but may not continue until mid-May.

        “I do think the most likely result here is that we'll be back at trial,” Wisconsin Attorney General James Doyle said Monday.

Could backfire
        Stephen Houck, a lawyer with the New York attorney general's office who heads the states' legal team in the trial, has openly discussed requiring Microsoft to sell its operating system blueprints to other software companies.

        State officials, who met in a conference call Monday, wouldn't comment afterward on what they will seek in settlement talks.

        “We have had some discussions but have not settled on what our settlement position would be,” Mr. Doyle said. “There are a lot of very technical suggestions.”

        William Kovacic, a George Washington University antitrust expert, predicted Microsoft would find any proposal to surrender its Windows blueprint “out of the question.”

        And he said it would be difficult for the government to design a remedy that would withstand future changes by Microsoft to its software, which is expected to undergo a major revision next year.

        “Imagine them saying we're willing to give up something that's going to be obsolete in a short time,” Mr. Kovacic said. “We'll give you today's product, assuming we'll have something tomorrow that's going to displace it. Who would bid for something that's going to be obsolete?”

        Microsoft said last week it won't accept restrictions on what new features it can add to Windows. But it indicated it would consider changing some of its most controversial agreements with computer makers and Internet providers.

Breakup rejected
        Critics of Microsoft have suggested breaking up the company, an idea rejected Monday by the company.

        Microsoft also asked U.S. District Judge Thomas Penfield Jackson on Monday to make America Online, Netscape Communications and Sun Microsystems turn over more e-mails about AOL's recent $9.9 billion purchase of Netscape and a related deal with Sun.

        Judge Jackson on Friday told Microsoft it can question Steve Case, AOL's chairman, and three other executives about their plans and the possible impact on the trial.

        AOL, Netscape and Sun are rivals of Microsoft. The alliance of the three companies illustrates healthy competition in the high-tech industry, Microsoft contends.

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