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News > Technology
Microsoft case sent back
August 24, 2001: 12:33 p.m. ET

Appeals court remands to U.S. District Court; new judge picked
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NEW YORK (CNNfn) - A federal appeals court returned Microsoft's four-year-old antitrust case to a lower court Friday, ordering a new judge to determine what action should be taken against the software maker as a remedy for its anticompetitive practices.

The U.S. District Court in Washington said it had randomly assigned the case to Judge Colleen Kollar-Kotelly, who will oversee proceedings to determine what remedies should be imposed to stop Microsoft from further abusing its monopoly in personal computer operating systems.

Kollar-Kotelly also is charged with determining whether Microsoft violated antitrust laws by tying the source code for its Internet Explorer Web browser to the source code of its Windows operating system software.

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Judge Colleen Kollar-Kotelly has been assigned to the Microsoft case.
Hearings in the case are expected to begin as early as next month.

The U.S. Court of Appeals for the District of Columbia in late June had overturned a lower court's order by U.S. District Court Judge Thomas Penfield Jackson that Microsoft be broken into two companies as a remedy for anticompetitive practices.

At the same time, the appeals court upheld Judge Jackson's finding that Microsoft held a monopoly in the market for computer operating systems and had used that power to engage in anticompetitive business practices that violated U.S. antitrust laws.

Judge Jackson was disqualified from re-hearing the case. In its original decision, the appeals court said he had violated ethical guidelines requiring judges to avoid public comments on pending cases to avoid the appearance of impropriety.

Some of the district court judges are believed to have recused themselves from the case, either because they may have conflicts of interest or are trying to avoid it. The case has been time consuming and brought negative attention to the judges who have handled the matter, including Jackson and Judge Stanley Sporkin, who presided over a related antitrust matter in 1994.

Kollar-Kotelly was appointed to the District Court in May 1997 under the Clinton Administration.

Click here to read Judge Kollar-Kotelly's biography

Microsoft – which said Friday it has put the finishing touches on its newest operating system, called Windows XP – last month asked the U.S. Supreme Court to take up the matter. In connection with that request, the company also had asked the appeals court not to delay any further proceedings until the Supreme Court had decided whether it would hear the case.

In its petition to the Supreme Court,  Microsoft highlighted the judicial misconduct issues the appeals court outlined in its original order and asked that the entire original district court order be overturned. The high court is not expected to decide whether it will hear the case until early October.

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Click here for CNNfn.com's special report: Microsoft on trial.
The appeals court last week denied Microsoft's request to postpone the proceedings, saying that the software maker had misconstrued its opinion, particularly with respect to what would have been required to justify vacating all of the district court's findings.

Some trial watchers have characterized Microsoft's recent legal moves as part of a broader strategy to prolong the court proceedings and delay any antitrust actions, including a potential court-ordered block of the release of Windows XP, until after the product is already in the marketplace.

Windows XP, due for release Oct. 25, incorporates features such as instant messaging, streaming media and digital imaging capabilities into the operating system, and has been targeted by Microsoft's foes who say it demonstrates further anticompetitive practices.

The Justice Department has pointed to the pending release of Windows XP as a reason the case should not be delayed, although it has not said whether it will seek to block the release of the new product, which many PC makers are hoping will be a catalyst for flagging sales.

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Settlement talks also reportedly have been underway between Microsoft, the U.S. Justice Department and some of the states that had prosecuted the case, although none of the parties involved has officially confirmed such talks.

Shares of Microsoft (MSFT: up $2.84 to $61.96, Research, Estimates) were up more than 4 percent in morning Nasdaq trade Friday amid a broader rally in the technology sector. graphic





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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.