The Appeals Court ruled that the actions of Judge Thomas
Penfield Jackson in the district court “seriously tainted the
proceedings.” The Court ordered that a new judge be appointed to
rule on the alternative penalties for Microsoft’s actions.
In June 2000, Judge Jackson ordered that Microsoft be split in
two, with one company running the Windows operating system business
and another company dealing with the rest of Microsoft’s products,
including its Internet Explorer browser software.
The Appeals Court found that Judge Jackson demonstrated bias
against Microsoft in both his ruling and in his comments to the
press at the time of the initial trial. Accordingly, Judge
Jackson’s judgment has been set aside.
The Appeals Court stated in its 125 page ruling:
"We vacate the judgment on remedies, because
the trial judge engaged in impermissible ex parte contacts
by holding secret interviews with members of the media and made
numerous offensive comments about Microsoft officials in public
statements outside of the courtroom, giving rise to an appearance
of partiality".
The Appeals Court reversed the ruling that Microsoft had
illegally tried to monopolise the market for browser software.
However, it upheld the finding that Microsoft had employed
anti-competitive means to protect its monopoly in the Windows
operating system. It has ordered a lower court to reconsider Judge
Jackson’s finding that Microsoft’s bundling of Internet Explorer
with Windows was illegal.
Chairman Bill Gates said he was “pleased with the reversal,”
adding that this decision will be used to strengthen Microsoft’s
hand at the negotiating table as it pursues a settlement with the
US government over the case.
Although many see the decision as a victory for Microsoft,
Charles James, a Justice Department anti-trust enforcer told news
agency Reuters: “Today’s decision represents a very significant
victory for the anti-trust division on the core claim in the
Microsoft case that Microsoft engaged in anti-competitive conduct
to preserve its monopoly position in computer operating
systems.”
The Attorney Generals of the 19 US states that were party to the
lawsuit have also made positive statements. At a press conference,
Connecticut Attorney General Richard Blumenthal said “the essential
result today is that the core claim has been upheld
unanimously”.
The stock market seems to have viewed the ruling as having been
a positive one for Microsoft. Trading in Microsoft stock was
suspended prior to the judgment, but when it resumed, Microsoft
shares rose 2.21% at $72.71 with analysts predicting another
increase in today’s trading.
Bill Gates said that the decision will now allow Microsoft to
push ahead with its plans for new products, adding: “With this
ruling, there is a new framework and so it would be a good time for
all parties to sit down together and see what kind of resolution
can be worked out.”
