States Vow to Keep an Eye on Microsoft

WASHINGTON -- Attorneys general from both the Justice Department and the states that did settle with Microsoft say a federal judge's decision Friday to accept nearly all of the settlement conditions is a victory for American consumers--but the states say the battle is not over.

One year after the Justice Department and nine states reached an agreement with Microsoft, U.S. District Judge Colleen Kollar-Kotelly accepted nearly all of its conditions. The District of Columbia and nine states that refused to sign on to the settlement sought harsher remedies, some of which were granted.

Attorney General John Ashcroft says the Justice Department and Microsoft reached an agreement "in the face of previous failures," praising the judge's "intense efforts" to reach her decision in the ongoing antitrust case.

The decision furthers "the public interest by fully and effectively addressing Microsoft's unlawful conduct and restoring the competitive conditions in the computer software industry," Ashcroft says.

The Justice Department reviewed more than 30,000 public comments in preparing the settlement, says Charles James, assistant attorney general for the antitrust division. He says the terms of the settlement will be enforced "very aggressively."

Holdout States Wary

The attorneys general representing the nonsettling states say they have not decided whether to appeal the decision. Once the states read the judge's decision, they will decide what is in the public's interest, says Iowa attorney general Tom Miller.

They are satisfied that Kollar-Kotelly accepted some of the proposals the states made, which Miller says make "strong improvements" to the settlement.

For example, the judge included a provision that requires a compliance officer who would report to the government on Microsoft's progress in implementing all the conditions.

This settlement "sends a message to the Microsoft board of directors that it will be held accountable at the highest levels of the corporation," says Connecticut attorney general Richard Blumenthal.

Miller says the judge's ruling also closes some loopholes in the settlement regarding PC vendors who deal with Microsoft, and ensures developers' access to some of Microsoft's intellectual property. Judge Kollar-Kotelly said Microsoft must license technology to PC vendors, software developers, and other partners that it needs in order to pursue any of the options that the judgment permits.

The holdout states also plan to keep a close eye on the general enforcement process of the settlement.

"The Department of Justice can take satisfaction in an improved result and further its goals," says Blumenthal, but "the final chapter has not been written."