Massachusetts Appeals Antitrust Ruling

Virginia at the last minute has joined Massachusetts in filing an appeal of U.S. District Court Judge Colleen Kollar-Kotelly's recent Microsoft antitrust settlement ruling.

Microsoft spokesperson Jim Desler confirmed on Monday that the company has heard from West Virginia, saying it will appeal.

On Friday, Massachusetts state Attorney General Tom Reilly said the state expected to pursue the case alone. The other holdout states have accepted Kollar-Kotelly's remedy and are turning their focus to enforcement.

"After a complete remedies trial, we were disappointed when the district court did little more than accept Microsoft's loophole-filled deal," Reilly said. "Microsoft has been found to have repeatedly violated the antitrust laws of this state and this country. We believe a remedy must send a message that breaking the law will not pay. Otherwise, it sends a dangerous message about what is acceptable behavior."

Even Friday, it was speculated that West Virginia might continue to pursue the case. Iowa Attorney General Tom Miller issued a statement Friday confirming that seven states, including his, and the District of Columbia will not appeal the decision.

West Virginia would make its decision by Monday, he said then. Monday was the deadline for the states to appeal.

Moving Forward

Desler said that the appeals will not affect the company's plans moving forward.

"Regardless of decisions by the states our focus remains on complying fully with the court's judgment," Desler said. "I would not characterize [Microsoft] as being surprised or disappointed."

California, Connecticut, Florida, Iowa, Kansas, Massachusetts, Minnesota, Utah, West Virginia, and the District of Columbia were the parties that declined to sign off on the federal government's initial proposed settlement with Microsoft. By continuing to pursue the case, the states won important concessions that strengthened enforcement provisions, Iowa's Miller said Friday.

Illegal Actions

California Attorney General Bill Lockyer also weighed in Friday, saying that the antitrust case has spotlighted Microsoft's illegal behavior.

"While not completely satisfying, the court decree closed enforcement loopholes, keeps compliance with the remedies squarely before the court and allows us to now turn attention to making sure that Microsoft competes fairly in the marketplace," he said in a prepared statement.

Because Microsoft was judged guilty of antitrust violations, the states are entitled to recoup their expenses for the case, which total $25 million in attorney fees and litigation costs, Miller said. Microsoft will also pay the states an additional $3.6 million to be used for funding enforcement efforts, he said.

Massachusetts' Reilly said he is not worried about continuing the case without the participation of the other states.

"We are prepared to go it alone," he said. "We always expected one way or another this would be resolved at the appellate level, and that's where it's going."

Ashlee Vance and Marc Ferranti of the IDG News Service contributed to this report.