MS-DOJ judge may appoint mediator

 
 
By Peter Galli  |  Posted 2001-10-11
 
 
 

There may be a new player in the Microsoft Corp. antitrust case, come Friday.

The software maker and the Department of Justice are scheduled to report back to U.S. District Court Judge Colleen Kollar-Kotelly in Washington on Friday about the progress on their settlement talks.

Kollar-Kotelly ordered two weeks ago that the parties had until Oct. 12 to settle the case. If that failed, she would then appoint a mediator.

Microsoft spokesman Jim Desler said today that the parties are preparing to report back to the Judge on Friday. "The parties have been engaged in intensive settlement talks, which have been conducted in good faith," said Desler. "If we have been unable to reach a settlement by tomorrow, the parties may inform the Judge that they have agreed on a mediator or, if not, the Judge could appoint one herself."

Desler declined to say whether a negotiated settlement was close, whether the parties had agreed on a mediator, or if they could settle given more time.

"The time-frame given by the Judge to reach a settlement by ourselves was short, but we are in intensive talks that are ongoing," Desler said.

A source familiar with the case said the parties are unlikely to have reached a settlement so soon, particularly given how far apart they were in the joint status report filed before the court last month.

Its also unlikely that they would have been able to agree on a mediator, given their vastly different positions on the issues in the case, so Kollar-Kotelly likely will have to appoint the mediator herself, the source said.

She also could give the two parties more time to continue settlement talks themselves if they indicated a settlement could be reached in the near future, he said.

In her order of two-weeks ago, Kollar-Kotelly said that while Microsoft and the government had indicated that they did not want a mediator appointed, "it has been three months since the appellate court rendered its decision with no resolution reached by the parties.

"The Court will give the parties until Oct. 12, 2001, to settle the cases on their own. However, if at the end of that time, they have not been fully successful, the parties shall submit to Chambers, on Oct. 12, 2001, the name of an agreed-upon individual to act as facilitator/mediator to assist the parties in their efforts," she said. "If the parties cannot agree upon an individual, then the Court will appoint such an individual to act as their facilitator/mediator."

If that happens, it will not be the first time the case has been refereed to a mediator. In Nov. 1999, District Court Judge Thomas Penfield Jackson, who was hearing the case, proposed a process mediated by Seventh Circuit Court of Appeals Chief Judge Richard Posner.

The process was unsuccessful and, in April 2000, Posner announced that he had "endeavored to find common ground that might enable the parties to settle their differences without further litigation. Unfortunately, the quest has proved fruitless."

Dana Hayter, an antitrust expert at Fenwick & West LLP in San Francisco and a former attorney with the DOJ who worked on the Microsoft antitrust case then, said he was skeptical mediation would be effective.

"I think it is unlikely that she will get the parties to settle or that mediation will effectively resolve the issues in the case," he said. "Given how far apart the camps were on every substantive issue in the joint status report filed recently, I believe the remedy phase will ultimately have to be tried."

Kollar-Kotelly said if the cases have not been fully resolved through settlement by Nov. 2, 2001, the Court will proceed with the scheduling order. The schedule said briefs would be due in December and the hearing to start March 11, 2002 if a settlement is not reached.

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