Justice Department Seeks Speedy Microsoft Appeal
The government contended Thursday it would be forced into costly trials against company after company unless an appeals court rapidly restores its antitrust settlement with Microsoft Corp.
The Justice Department asked the U.S. Circuit Court of Appeals here to move quickly to overrule District Judge Stanley Sporkin, who rejected the settlement Tuesday. Microsoft, based in Redmond, Wash., announced it would join the government in the appeal and abide by the settlement in the meantime.
Legal experts across the political spectrum predicted the appellate court would overturn Sporkin’s decision.
Attorney General Janet Reno told her weekly news conference Thursday that Sporkin had overstepped his authority under the Tunney Act to decide whether the consent decree embodying the settlement would serve the public interest.
Consent decrees are court orders under which a company or other defendant denies violating any law but agrees to stop practices the government claims are illegal. Both sides avoid the high cost of a trial.
Only a handful of antitrust consent decrees have been rejected by judges, and appeals courts here and in California have overruled those judges in two cases.
Sporkin’s rejection was so broad the government called it “unprecedented in the history of the Tunney Act,” a Watergate-era law enacted after allegations that politics swayed the Nixon administration’s rulings on a merger by the conglomerate ITT.
“As long as Judge Sporkin’s decision stands, scarce government resources likely will be wasted litigating cases that (the government) otherwise would settle,” the Justice Department told the appeals court in requesting an expedited hearing. The government said its arguments could be ready in 21 days.
Sporkin’s ruling “will harm the public by deterring the department and antitrust defendants from entering into consent decrees,” said Assistant Attorney General Anne Bingaman, head of the antitrust division.
Bingaman said her division files about three consent decrees a month. They also are used to settle many other kinds of civil lawsuits, particularly over environmental pollution. But judges have less review power over those than the Tunney Act gives them in antitrust cases.
Sporkin ruled that the Microsoft decree was too narrow. He criticized it for not addressing several types of violations alleged by Microsoft competitors. And he objected that it only barred future use of some licensing practices rather than undoing any unfair advantage the giant computer software maker may have gained through such practices in the past.
Reno said Sporkin “crosses over the line between the judicial and the executive branch.” He should just decide whether the settlement “remedies the illegal conduct” alleged by the government, she added.
“This is a blatant example of a judge trying to act as an executive branch official,” agreed Charles F. Rule, who headed the antitrust division during the Reagan administration. He predicted the government would find “a sympathetic audience” at the appeals court.
“I have every confidence the government will prevail,” said John Shenefield, antitrust chief during the last Democratic administration under President Carter.
Stanford law professor William F. Baxter, another Reagan antitrust chief, agreed: “Their chances are very good.”
“There’s an excellent chance he’ll be reversed on appeal, and it’s very important for private businesses,” said Arthur Golden, a lawyer at Davis, Polk & Wardwell in New York who has spent 25 years defending companies in antitrust cases.