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Microsoft gains delay
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June 14, 2000: 12:25 p.m. ET
Judge won't OK Supreme Court review until company has chance to respond
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NEW YORK (CNNfn) - The federal judge in the Microsoft antitrust case will not approve the government's request to push the case to the Supreme Court until Microsoft has a chance to respond and file its objections, expected within the next four days.
The Justice Department filed a motion Tuesday with Judge Thomas Penfield Jackson requesting that the U.S. Supreme Court get the case, citing a law passed in 1974 known as the Antitrust Penalties and Procedure Act, or more commonly, the Antitrust Expediting Act.
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VIDEO
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CNNfn's Steve Young reports on Microsoft's appeals process.
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The Supreme Court then would have the option of reviewing the case, sending it back to the Court of Appeals, or delaying action on the case. The Supreme Court is under no obligation to hear the case, and experts said the court may prefer to see the case moved through the legal system before it accepts it.
Under the federal rules of civil procedure, any time a motion is filed, as when the government filed its motion Tuesday, a party is given up to 11 days to respond to the filing.
Based on what Microsoft says in its response to the DOJ's motion, Judge Jackson will either give the go-ahead to push the appeal to the Supreme Court or deny the motion.
"The government's petition is certainly questionable about the rationale for expediting this case directly to the Supreme Court," Microsoft spokesman Jim Cullinan said. "Microsoft does not believe that the government should try to evade the Court of Appeals."
Microsoft, which seemed to lag the government throughout the antitrust trial against it, moved a step ahead of the Justice Department, now that an appeal of the final ruling against the company is looming.
The software heavyweight won a small victory late Tuesday, as the U.S. Circuit Court of Appeals, saying the case is of "exceptional importance," agreed to expedite review Microsoft's appeal of the court-ordered breakup of the company.
"Microsoft succeeded in taking the initiative on the appeal," said William Kovacic, an antitrust expert at the George Washington School of Law in Washington, D.C. "I don't think the government really thought through all of the possible scenarios, and Microsoft ended up outmaneuvering them."
Microsoft filed its appeal brief late Tuesday afternoon, and within the hour the Court of Appeals decided to hear the case. Many legal experts say Microsoft probably is happy with the swift decision, because the justices on the Appeals bench are seen as more sympathetic to its point of view.
Of the 10 justices on the Court of Appeals, three have been recused or disqualified from the case: Justices Merrick Garland, Laurence Silberman, and Karen Henderson, all of whom previously worked for the Department of Justice.
The remaining justices hearing the case are Stephen Williams, David Sentelle, A. Raymond Randolph, Harry Edwards, Douglas Ginsburg, David Tatel and Judith Rogers.
"These are some of the most conservative judges in the country," said Robert Lande, director of the American Antitrust Institute and a professor at Baltimore School of Law. "Ginsburg, in particular, used to head the antitrust division under the Reagan administration, so to say that he is antitrust-savvy is an understatement; the man knows antitrust law backwards and forwards."
"If you're really, really conservative, then you start with a very strong attitude that companies should be allowed to do whatever they want and the government shouldn't interfere with that. If you fix prices, that's a different story, but we're talking about behavior that isn't clear cut like price fixing," Lande said.
Lande also said the Court of Appeals may be favorable to Microsoft's case, since Jackson's ruling was harsh and disrespectful of earlier rulings concerning the company that were issued by Court of Appeals Justices Williams and Randolph.
 In its appeal brief, Microsoft called the breakup unfair and said the court findings include mistakes.
"We will be seeking reversal of many factual findings that were clearly in error. We will be seeking review of many key legal issues where the court has disregarded established legal precedent. And we will be pointing out numerous procedural irregularities that had the effect of denying Microsoft its due process right," the Microsoft brief said.
"Microsoft's appeal will present an overwhelming case for reversal of the judgment based on an array of serious substantive and procedural errors that infected virtually every aspect of the proceedings below. These flaws culminated in the entry of unprecedented relief that extends far beyond the case that was presented," Microsoft said.
In its filing to move ahead to the Supreme Court, the government said the matter would be expedited given its financial impact on the economy and would receive fairer treatment than if reviewed by the Appeals Court.
"In light of the importance of this case to the software industry and of the software industry to the global economy, direct Supreme Court review is appropriate in order to expedite final resolution of the disagreement among the parties about the standards that should govern Microsoft's conduct."
"Direct appeal to the Supreme Court in the first instance would resolve this case more quickly than review by the Court of Appeals. The Court of Appeals would be unlikely to render a decision satisfactory to both sides, thus foreclosing the possibility that intermediate review will obviate further
petitions to the Supreme Court. Given the importance of the case and its impact on the economy, it is likely that the Supreme Court would grant review."
Some legal experts wonder if the Supreme Court actually will take the case, citing how infrequently the law has been used since it was passed in 1974.
"It's not that likely that the Supreme Court will take the case," said Lande. "This law has only been used two times - both times in the AT&T antitrust case - so it's rarely, rarely used."
"The longer it sits at the Court of Appeals, the less likely the Supreme Court is to take it on an expedited basis," Lande said. "To the extent that the Court of Appeals really starts to get their teeth into this, they could jump on this right away."
Early Wednesday, Microsoft founder Bill Gates, who is on an Asian tour, shrugged off worries that the company would be split and downplayed rumored morale problems among employees.
"Certainly, morale in the company is very high," Gates said. "We have plenty of talent to do the things we want to do. "[This] is an issue for the legal department but not for the vast majority of the company. It has not changed the delivery cycle of any of our products."
Investors applauded the news, sending shares of Microsoft up 2-13/16 to 70-11/16 in trading Wednesday.
Also Wednesday, Lehman Brothers analyst Michael Stanek reiterated his "buy" rating on Microsoft stock. "Microsoft's chances just went up," Stanek said in a research note. 
-- from staff and wire reports
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