Microsoft: Feds Hindering Products

In its formal answer to last month's Justice Department antitrust charges, the company argues the government knew all along that it was integrating Internet Explorer with Windows and has no right to get in the way.

WASHINGTON - Microsoft Corp. today released the contents of its voluminous answer to Justice Department antitrust allegations - arguing in essence that in targeting the company's Internet Explorer browser, the government is trying to prevent it from improving its products.

In a 48-page brief accompanied by declarations from both company officers and allies in the computer industry, Microsoft asked US District Court Judge Thomas Penfield Jackson to dismiss the government's case. The brief, filed last Wednesday night, said that prosecutors' request for a US$1-million-a-day contempt citation "is aimed squarely at preventing Microsoft from including improved features and functionality in upgraded versions of Windows 95."

The government's case, filed 20 October, focuses on the company's strategy in pushing its Internet Explorer, and on whether it tried to coerce PC-makers to bundle the browser onto their machines as a tactic to cut into rival Netscape's market share. The arm-twisting would violate a 1995 federal consent decree in which the company agreed not to tie the purchase of one product to another but retained the right to develop new, integrated products.

As anticipated, the main pillar of the company's fight against the suit is that the integration of Internet Explorer and Windows has been afoot for years. And beyond that, the Microsoft brief asserts, the government knew full well that was happening when it signed off on the 1995 court order.

"As the DOJ knows, the technologies in question have been a central thrust of Microsoft's operating-system development efforts for more than three years," the brief states.

The company also accused the Justice Department of taking up legal cudgels on behalf of Netscape.

"Although the DOJ professes not to be 'taking sides' in a competitive battle that continues to provide clear benefits to consumers, that is precisely what the DOJ is doing," the Microsoft filing said.

The document also defends Microsoft nondisclosure agreements with business partners that have come under attack from the Justice Department and other quarters on the grounds they may be hurting federal and state inquiries into the company's business practices.

"Such non-disclosure agreements are nowhere addressed in the (1995) consent decree, so they are not a proper subject of a contempt proceeding," the Microsoft brief said.

The government is scheduled to file its response to the Microsoft documents by 20 November. Reuters contributed to this report./i>