Microsoft Submits Response To Court

SEATTLE -- Attorneys for Microsoft Corp. were busy Tuesday preparing their final legal response to the government's plan to break up the software giant for antitrust violations.

The response, which was to be presented Wednesday in U.S. District Court in Washington, is Microsoft's last opportunity to make its case before Judge Thomas Penfield Jackson enters his final ruling.

Microsoft spokesman Jim Cullinan said the company's filing will address the substance of the Justice Department's revised breakup plan that was filed at Jackson's request.

On May 24, Jackson abruptly closed the proceedings in the case, refusing Microsoft's repeated requests for more time. He gave the government until last Friday to issue its revised planand gave two business days for Microsoft to respond. A ruling could come any time after Jackson receives Microsoft's response.

Company officials said the judge's sudden move caught Microsoft unaware, though they were prepared for any eventuality. The company hurriedly filed an "offer of proof" just before Jackson ended the May 24 hearing, detailing the testimony of witnesses, including company chairman Bill Gates and chief executive Steve Ballmer, that the company still wanted to call.

Microsoft had asked the judge for up to six months to gather evidence and depose witnesses that would dispute the Justice Department's assertion that a breakup is the best way to reverse the damage done by the behavior that Jackson found anticompetitive.

The Justice Department and 17 of the 19 states that sued Microsoft for antitrust violations recommended last month that the company be broken into two pieces - one that would own and market the Windows operating systems and another that would control all other Microsoft software, including the popular Office suite and the company's Internet holdings.

Microsoft has said it did nothing wrong and will appeal Jackson's findings and any remedy he proposes, which would extend the legal fight months, if not years. The case will either go to the court of appeals or straight to the Supreme Court, an option available in major antitrust cases.

A breakup of Microsoft would be the harshest antitrust penalty leveled against a U.S. corporation since AT&T agreed to spin off the regional "baby bells" in 1982, Reuters reported.

With Jackson apparently ready to issue his final order at any time, the company postponed an event this Thursday to launch its Next Generation Windows Services, a multibillion-dollar effort to make Microsoft software and data available through the Internet to any kind of computing device, including cell phones and handheld organizers.