Judge: Microsoft's Failure To Negotiate Led To Breakup Decision



If only Microsoft had played ball, then maybe it wouldn't be facing a potential breakup of the company. At least, that's what District Court Judge Thomas Penfield Jackson seemed to be saying during his comments Thursday at an antitrust conference in Washington, D.C.

Jackson told the audience that the decision to recommend splitting up Microsoft was never his "remedy of choice," but was made necessary by the company's unwillingness to negotiate with the Department of Justice. In fact, Jackson said he would have preferred not to order the breakup, which is pending the outcome of Microsoft's antitrust case, now scheduled to be heard by the U.S. Court of Appeals. A member of Jackson's staff says the judge declined to comment further.

Both the Justice Department and Microsoft also declined to comment on Jackson's statements, but legal experts offered various interpretations.

Mark Ostrau, an antitrust and intellectual property partner with Silicon Valley law firm Fenwick & West LLP, says that while Jackson "talks more than most judges," in this case his words should reverberate in legal departments throughout corporate America. "Companies should not discount the potentially much worse result they can get from rolling the dice," Ostrau says.

Meanwhile, George Cumming, head of the antitrust practice at Brobeck, Phleger & Harrison, says Jackson was expressing understandable frustration that the settlement talks between the Justice Department and Microsoft proved fruitless. While Cumming describes Jackson's willingness to discuss the case as "refreshing," he also says there are limits to how far Jackson should stray with his comments. "He shouldn't go on a standup comedy kick and do Microsoft schtick on '[David] Letterman.' "

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