Most of Microsoft fine upheld in Europe

BRUSSELS – A European court on Wednesday upheld most of a massive fine levied against Microsoft by the European Commission’s competition watchdog, closing a case against the software giant that began in 1998.

In an appeals ruling, the General Court of the European Union rejected Microsoft Corp.’s request to dismiss the fine levied in 2008, but did trim it by $48.6 million to $1.1 billion. Counting two earlier fines, the case has wound up costing Microsoft a grand total of $2.04 billion.

That’s the most ever resulting from a single antitrust case in Europe, though in 2009 Intel Corp. was hit with the largest single fine, $1.36 billion.

The court in Luxembourg said its decision “essentially upholds the Commission’s decision and rejects all the arguments put forward by Microsoft in support of annulment.”

The $1.07 billion fine is a “penalty for noncompliance” with the watchdog’s 2004 order for Microsoft to make computer programming code available that would allow competitors’ products to interface properly with Microsoft’s server software.

Microsoft did so, but at a price the Commission said was so exorbitant it amounted to not complying.

The court upheld that finding, but said Microsoft deserved a small break because of a letter the Commission sent in 2005 saying the company didn’t have to freely distribute code that wasn’t its own and was freely available elsewhere. That letter should have been “taken into account in determining the gravity of the conduct found to be unlawful,” the written decision said.

The Commission’s top regulator Joaquin Almunia said the judgment “fully vindicates” his office’s action against Microsoft and “brought significant benefits to users.”

“A range of innovative products that would otherwise not have seen the light of day were introduced on the market,” thanks to the Commission, he said.

Microsoft was less enthusiastic.

“Although the General Court slightly reduced the fine, we are disappointed with the Court’s ruling,” the company said in a statement.

Microsoft was initially fined $619 million along with the 2004 order, then it was penalized another $349 million for noncompliance in 2006, and then another $1.12 billion in 2008.