Microsoft case in a nutshell

June 7, 2000: 10:15 p.m. ET

Highlights of the legal battle between Microsoft and the Justice Department

NEW YORK (CNNfn) - A chronology of key events in the legal battle between Microsoft and the Justice Department, a lawsuit that has spanned two-and-a-half years - and running.

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CNNfn's Fred Katayama looks back on Microsoft's history.
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October 1997 - The Justice Department sues Microsoft (MSFT: Research, Estimates), alleging the software maker required computer manufacturers to ship Microsoft's Internet Explorer Web browser on PC's loaded with Windows 95. Attorney General Janet Reno also asks a federal court to impose penalties of $1 million per day.

October 1997 - Compaq Computer Corp. (CPQ: Research, Estimates), the world's largest maker of personal computers, claims Microsoft threatened to cancel Compaq's Windows 95 license if Compaq put Windows 95 on its PCs without Microsoft's Web browser.

November 1997 - The Justice Department charges Microsoft chose to integrate its Web browser with Windows 95 in a desperate attempt to grab market share from rival Netscape Communications Corp.

Dec. 11, 1997 - U.S. District Judge Thomas Penfield Jackson issues preliminary injunction demanding that Microsoft stop requiring PC makers to install its Web browser on computers.

Jan. 22, 1998 - Microsoft reaches a partial settlement with the Justice Department that allows personal computer makers to remove or hide its Internet software on new versions of Windows 95. Separately, Netscape announces plans to give its browser away for free.

March 2, 1998 - One day before Bill Gates is scheduled to testify before the U.S. Senate Judiciary Committee, Microsoft revises deals it has with approximately 40 Internet service providers, allowing them to promote browser software made by Microsoft competitors.

April 14, 1998 - Microsoft says it will ship Windows 98 integrated with the Internet Explorer Web browser and a browser icon visible on the desktop. The company says it has no plans to allow computer makers to hide the browser icon, as they can under an agreement that applies to Windows 95.

May 18, 1998 - Regulators from the Justice Department and 20 states launch one of the biggest antitrust assaults of the century, accusing Microsoft of using its dominance in computer software to drive competitors out of business. The filing comes after negotiations between the government and Microsoft officials break down.

Oct. 19, 1998 - Trial of the federal antitrust suit against Microsoft begins. Lead Justice Department attorney David Boies uses internal company documents to contradict Bill Gates' statements in a videotaped deposition that he was not aware of a controversial 1995 meeting with Netscape executives.

Oct. 21, 1998 - Netscape Chief Executive Officer James Barksdale testifies that Microsoft threatened to "destroy Netscape's business" unless the company agreed to concede the Windows browser market. Lead Microsoft attorney, John Warden, later accused Netscape of fabricating details of the meeting.

March 29, 1999 - Microsoft reorganizes its operations into four separate divisions. Company officials stress the restructuring is unrelated to its ongoing lawsuit with the government.

June 7, 1999 - IBM (IBM: Research, Estimates) executive Garry Norris testifies that Microsoft threatened to withhold the computer maker's Windows license because IBM intended to include rival software in its PCs.

Nov. 5, 1999 - U.S. District Court judge rules that Microsoft holds monopoly power in the market for PC operating systems, and the company's actions harmed consumers.

Nov. 19, 1999 - District Court judge appoints federal appeals judge, Richard Posner, to serve as a mediator to handle the negotiations between Microsoft and the government.

Jan. 13, 2000 - Microsoft Chairman Bill Gates hands over the day-to-day management of the software company to Steve Ballmer, as part of a corporate reshuffling that will allow Gates to focus on long-term strategies.

April 1, 2000 - Judge Posner announces the end of negotiations between Microsoft and the government after four fruitless months of talks, setting the stage for a verdict by Judge Jackson.

April 3, 2000 - Judge Jackson rules Microsoft Corp. violated the nation's antitrust laws by using its monopoly power in personal computer operating systems to stifle competition.

April 28, 2000 - The Justice Department and a group of state attorneys general ask Judge Jackson to split Microsoft into two separate companies; one devoted to the Windows operating system and the second to Microsoft's other businesses, including popular software applications such as Microsoft Office.

May 10, 2000 - Microsoft Corp. asks a federal judge to throw out the Justice Department's plan to break up the software maker, saying the remedy would be an extreme penalty for the antitrust violations the judge found the company to have committed.

May 24, 2000 - Judge Jackson stuns Microsoft by refusing its request for additional time to prepare a defense to the government's breakup proposal. The judge also orders the government to submit by Friday an explanation of why it wants to split Microsoft into only two, instead of three, parts. The judge indicates he wants to bring the trial to a speedy conclusion.

June 1, 2000 - Judge Jackson surprises the litigants again, this time granting the government and Microsoft additional time to review each other's remedy proposals, which they've been revising and trading back and forth in the previous week.

June 5-6, 2000 - The government and Microsoft trade their last remedy briefs, setting the stage for a final ruling from Judge Jackson.

June 7, 2000 - Judge Jackson issues final ruling calling for Microsoft to be split into two companies, one for the Windows operating system and another for its Internet and other businesses.