European court rejects Microsoft antitrust appeal. The company lost after three years of legal wrangling, forcing the world’s biggest software maker to pay a record €497 million fine and help rivals connect their products to the Windows operating system.
The European Court of First Instance (CFI), the EU’s second-highest court based in Luxembourg, was scheduled to deliver its main findings at 9:30 a.m. (0830 GMT). Though the verdict written by the 13-judge Grand Chamber of the CFI was expected to be hundreds of pages, Monday’s court procedure may only last minutes, leaving legal experts and journalists to dig out the legal reasoning behind the ruling.
Not surprisingly, the long-anticipated judgment will draw world attention, with hundreds of journalists in application to witness the historical moment at the Grand Salle of the CFI, which can hold about 200 people. As the judges and court officials, bound by an oath of secrecy, kept their lips tight, the outside and even the two parties remained in darkness about the outcome, while both the commission and Microsoft were claiming they stood for innovation and consumer interests. Jonathan Todd, commission spokesman for competition, said the case is a classic example of dirty tricks by a powerful company. “The basic question is, do we allow a company which has 95% of the market to make choices for us, or should consumers and users of computers have the possibility to make their own choices,” he said.
Todd was countered by Erich Anderson, vice president and associate general counsel for Microsoft in Europe. He said there were two key issues in the case. “The first involves the ability of leading companies to improve their products,” he said, “the second issue in the case is really about whether leading companies are required to share the innovative technologies that they have developed with their rivals. ”
The case originated in 1998 when the US software company Sun Microsystems complained to the commission that Microsoft was refusing to supply it with interoperability information necessary for its server software to interoperate with Microsoft’s dominant PC operating system, triggering the EU’s antitrust investigation, which was later broadened to include Microsoft’s tying of its own Media Player product with Windows operating system. In its 2004 decision, the commission ordered Microsoft to correct the two types of anti-competitive conducts and fined the company a record €497 million ($689.9 million).
Microsoft then contested the decision at the CFI in June 2004 before the commission imposed another fine totaling €280.5 million ($389.4 million) last July, based on the finding that Microsoft failed to fully respect its 2004 decision. The CFI had to decide whether to uphold the commission’s decision and keep the fines in place, but it was unlikely to give a clear-cut victory to either side, as legal experts predicted. No matter what the outcome would be, analysts said the decision would change the landscape of the EU’s antitrust regulation and affect the future of promising IT industry.
The European Court of First Instance in Luxembourg today backed the European Commission’s 2004 decision that ordered the US company to disclose proprietary data and strip music and video software from a version of Windows. The judgment can be appealed to the European Court of Justice, the EU’s highest court. “This is deeply troubling for business, the state of the law and trans-Atlantic relations,” said Philip Marsden, a competition lawyer and senior research fellow at the British Institute of International and Comparative Law. “The ruling shows a total diversion between the US and Europe.”
Microsoft is still undecided over the next legal steps to take, following the sentence by the First Degree Court which has rejected its appeal against the disciplinary measures handed down by the EU Commission for abuse of dominant position. “We must study the sentence before making any decisions,” said Brad Smith, its head legal advisor. Microsoft shares fell 2.5% to $28.32 as of 12:11 p.m. in Frankfurt trading. (people.com.cn, agi.it))