Microsoft Appellate Decision A Victory for Antitrust, Says AAI Statement

A Statement Regarding the Microsoft Decision

The following statement should be attributed to Albert A. Foer, president of the American Antitrust Institute.

"The decision of the District of Columbia Court of Appeals in the antitrust case against Microsoft is a victory for antitrust advocates. The legal core of the case, that Microsoft is a monopolist and illegally used its monopoly power to sustain its dominant position in the operating system market, was unanimously upheld by a court composed of ideologically diverse judges. As the Court itself said in its decision, 'We uphold the District Court's finding of monopoly power in its entirety.'

"A number of elements of the ruling are significant. First, the monopoly maintenance charge that was unanimously upheld is the basis for the structural remedy. While the remedy was remanded, the lower court that will now hear the case is legally obliged to ensure that Microsoft's ability to abuse its monopoly power is terminated, that it is denied the benefits of its monopoly abuses and that it is prevented from committing these illegal, anticompetitive activities again. A structural solution is still on the table, and the evidentiary hearing may well demonstrate that it is the most effective remedy to accomplish these objectives.

"In addition, because the remedy was remanded to a lower court and the remedy process must be forward-looking, new evidence will be introduced in the trial. This will provide the Department of Justice and the state Attorneys General an opportunity to shine a spotlight on the myriad anticompetitive activities Microsoft has undertaken since the end of the trial - not the least of which involves the introduction of its new XP operating system and .NET Internet services platform.

"We are also encouraged by the Court's easy dismissal of Microsoft's defense that it can do what it pleases because of an alleged absolute right to license its copyright property without regard to the antitrust laws. In saying this argument 'borders on the frivolous,' the Court importantly undermines a dangerous trend that has been promoted in some quarters to turn intellectual property-a key asset in the so-called New Economy-- into a pass that allows its owner to ignore antitrust limitations.

"Overall, this ruling reinforces the strength of our nation's antitrust laws, which are essential for preserving competition and ensuring innovation. The decision gives prosecutors substantial leverage for its coming decisions. For the good of our economy and for the good of consumers, we hope that the government will not settle for anything less than a remedy that will fully accomplish the historic, bipartisan objectives of the antitrust laws."