Two States Say Microsoft Breakup Should Wait

 
 
By eweek  |  Posted 2000-04-28
 
 
 

The state attorneys general remained divided until the end on the proper remedies to be imposed on Microsoft Corp., with 17 of the 19 states siding with the Department of Justice and Ohio and Illinois filing a separate remedy proposal.

The dissenting states proposal was appended to the long-awaited proposal filed Friday afternoon to Judge Thomas Penfield Jackson by the DOJ and the other states. The two dissenting state AGs seek similar conduct restrictions but no breakup of the software maker. They suggest instead that further remedies may be applied, which could include splitting up the company, if conduct restrictions havent done the trick after three years.

In a press conference held this afternoon by the 17 states, Iowa Attorney General Tom Miller said that, despite the split in opinions, "the states enter Judge Jacksons court as a unified force."

Miller said Kevin OConnor, assistant attorney general for Wisconsin, would be presenting the proposal for the states in court, taking over the role of Steven Houck, former lead counsel for the states during the trial and now a New York antitrust attorney. Ohio and Illinois, said Miller, will not represent themselves separately in court.

The AGs from Ohio and Illinois, Betty Montgomery and Jim Ryan, were not at the press conference.

States considered everything under the sun

Miller said the subject of possible remedies has been debated among the states ever since the trial started and that the group had considered every idea "under the sun."

Miller and other AGs took pains to describe their proposal as pro-competitive and pro-consumer.

"It can be a real watershed for American consumers because its watchwords are competition and innovation," said Dick Blumenthal, Connecticuts attorney general.

"This is a remedy, not a penalty," said Bill Lockyer, Californias AG, emphasizing, as did his colleagues, that the economy would be bolstered, not destroyed, by the possible breakup of the software giant.

Miller described the split of Microsoft into two companies as the "least intrusive reorganization" for everyone, including Microsoft shareholders.

"The value of the stock will remain neutral or go up," he predicted.

But Miller said he wouldnt venture to guess whether Judge Jackson would accept the governments proposal lock, stock and barrel.

"Out of respect for the judiciary," said Miller, "we dont lay odds or make guesses."

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