Judge in Microsoft antitrust case shows skepticism with states' claims; delays proceeding by one week

<br>WASHINGTON (AP) _ The judge in the Microsoft antitrust case said Friday she is skeptical about an effort by nine states to punish Microsoft for its entrance into new markets like handheld computers

Friday, March 8th 2002, 12:00 am

By: News On 6

WASHINGTON (AP) _ The judge in the Microsoft antitrust case said Friday she is skeptical about an effort by nine states to punish Microsoft for its entrance into new markets like handheld computers and television set-top boxes.

U.S. District Judge Colleen Kollar-Kotelly also delayed the beginning of a hearing to determine whether Microsoft should face the stiff sanctions those states prefer. First scheduled to begin next Monday, the hearing will now start on March 18. It could last more than two months.

Nine states and the District of Columbia are seeking harsh penalties against Microsoft for violating antitrust law and hurting consumer choice. Among other measures, they want Microsoft to offer a ``modular'' version of its Windows operating system so that computer manufacturers and users can swap out extra Microsoft features in favor of those made by competitors.

The states also want to show how competitors in new markets may threaten Microsoft's monopoly on computer operating systems, and how Microsoft is using unfair business practices to battle those threats. Microsoft has smaller versions of Windows that work on television set-top boxes and handheld computers.

Steven Kuney, a lawyer for the nine states, called those devices the ``threats that are today in Microsoft's sights.''

Kollar-Kotelly said the states' point of view ``raised a red flag.''

``I have some concerns frankly about your argument,'' she said. ``I frankly think you don't have enough case law.''

The judge reserved judgment, however, on Microsoft's bid to keep the states from seeking penalties for its move into the extra markets. She asked both sides to give her more information about the dispute.

The federal government and nine other states settled their claims with Microsoft last year. On Wednesday, Kollar-Kotelly heard Microsoft's and the Justice Department's reasons why she should approve the deal. She indicated she would not make her determination soon.

The original judge in the case, Thomas Penfield Jackson, ordered Microsoft to be broken up into two companies after concluding Microsoft violated antitrust laws by illegally stifling its competitors.

A federal appeals court reversed that penalty and appointed Kollar-Kotelly to determine a new penalty in one of the most significant monopoly cases in U.S. history.

Kollar-Kotelly also delayed a decision on whether the states could argue that letting computer manufacturers remove software from Windows _ like its Web browser or instant messaging program _ is a reasonable way to help software developers compete and give consumers more choice.

Microsoft wants to hold the states to its previous call for the company to allow computer manufacturers to delete icons for those Windows features.

``That's what causes the Balkanization of Windows,'' Microsoft lawyer John Warden said of the software removal. ``That's what hurts (software vendors) and consumers.''

Warden became animated, continually trying to jump up to the podium and reiterate to Kollar-Kotelly that the federal government only pushed for icon removal.

``I've lived with this case for three years,'' Warden said. ``This is almost a Kafkaesque experience.''

In a separate development, Sun Microsystems said Friday that it is suing Microsoft for more than $1 billion because the software giant released versions of Sun's Java programming language that were incompatible with Sun's own product. This effectively killed the language _ touted for working on different types of operating systems _ before it could become a standard.

AOL Time Warner, on behalf of its subsidiary Netscape, is also suing Microsoft for an unspecified amount for Microsoft's efforts to push Netscape's once-dominant Navigator Web browser out of the market.

Both issues are central to the antitrust trial.