Judge Probes Modularizing of Windows Issue

The non-settling states and Microsoft were back in court Wed. arguing for and against, respectively, modularizing Windows.

The parties in the Microsoft Corp. remedy proceeding were back in court Wednesday to argue various motions key to the case and central to the judges ability to make a decision -- including the scope of what should be included in the case and the liability judges findings.

U.S District Judge Colleen Kollar-Kotelly took charge of the hearing early on, setting the tone with pointed questions for both Microsoft Corp. and the non-settling states regarding whether to consider technologies in question and "same or similar" conduct the software giant may have engaged in since the liability case concluded.

"When were talking about same or similar, were talking about whether the plaintiffs can identify technologies and the conduct that gave rise to the liability," Judge Kotelly said.

The judge identified four technologies the states have tried to bring into the scope of the case: server operating systems, Web services, set-top boxes and handheld devices. The states claim Microsoft has attempted -- or could attempt -- to use its might to sway the market for these technologies.

"Can you give me an example of conduct thats the same or similar, but is not an allegation of new anticompetitive conduct," Judge Kotelly asked Steven Kuney, an attorney for the states.

Kuney replied that, like middleware, which he said can "erode the applications barrier to entry" the four technologies pose the same threat to Microsoft.

Judge Kotelly said she understood the potential for Web services and server operating systems to pose such a threat, but said she was "less clear" on the states theory for set-top boxes and handhelds.

Kuney argued that thousands of applications are being written for handheld devices, particularly the Palm. He said if developers write to handhelds, "thats a threat to the desktop monopoly of Microsoft" and "a platform threat to Windows." Because "the ultimate battle is a battle for the interests and loyalty of software developers," he said.

"Any new technology would be perceived as a platform threat?" the judge asked Kuney.

"The technologies Microsoft views as threats to its monopoly are a good guidepost to whats a threat," he said.

However, Dan Webb, arguing for Microsoft said that neither Linux and other server operating systems, set-top boxes or handhelds should be considered in the scope of the remedy because they do nothing to increase competition in the market for PC operating system.

"If developers write more applications for a server operating system that doesnt affect the monopoly," Webb argued. Microsoft would have the same monopoly in the relevant market as defined by the court of appeals, he said.

Further, Webb argued that some of U.S. District Judge Thomas Penfield Jacksons findings should not be considered in the remedy because Jacksons conclusions were based on an "erroneous" analysis that was rejected by the court of appeals.

"Conclusions of law based on an erroneous legal standard and findings of fact based on that are irrelevant," Webb said.

The judge also asked the states whether the issue of denying end user access would suffice as a remedy as opposed to removing code, which is key to one of the states proposals – that of forcing Microsoft to deliver a modular or stripped down version of windows.

Kuney argued that the issue of end user access and the commingling of code, such as with the Internet Explorer browser and the Windows operating system, are separate issues, and that code removal is required to properly remedy Microsofts anticompetitive behavior.

Judge Kotelly pointed out that the interim measures set forth by Judge Jackson do not call for code removal. Kuney replied that was because at that point a breakup of Microsoft was still on the table.

He added: "The significance of code removal is not to make Windows a piece of Swiss cheese with holes, but to enable competing middleware to fill the spots."

John Warden, an attorney for Microsoft strenuously objected to Kuneys proposal, saying Microsoft believes the removal of end user access satisfies the states demands and was good enough during the liability phase of the case and should therefore be good enough now.

"Its wholly inappropriate for the plaintiffs in a case like this to engage in bait and switch tactics," Warden said. "The [relevant] market didnt apply to any of the things they now want relief to. They told the Court of Appeals this is not about code removal, its about end user access. Here they procured a ruling on the basis of their presentation to the court of appeals, and said uh-uh, this thing of end user access is not about removing code. How they can run from that now I cant conceive."

Warden pointed out that the non-settling states signed the same brief as the settling states on this matter in the liability phase of the case.

Judge Kotelly will hear more arguments on different motions both Thursday and Friday afternoons.

She assured the parties she has made no decisions yet.

"Let me assure counsel Ive made no decisions in this area," she said.