Clinton May Seek Microsoft Briefing

The White House might ask to be briefed by the Justice Department about the penalties it will seek against Microsoft Corp. for violating antitrust laws, a spokesman said Thursday.

"We have not been involved in this, but we have not ruled out being briefed on the case," White House spokesman Jake Siewert said last night. Siewert would not say what other White House involvement might be possible.

Presidential participation in antitrust decisions is extraordinarily rare but not unprecedented, according to antitrust scholars.

Microsoft Chairman Bill Gates met with President Clinton at the White House on Wednesday in a summit on the "new economy," two days after US District Judge Thomas Penfield Jackson ruled that the company broke federal and state antitrust laws by engaging in predatory tactics to protect monopoly in personal computer operating systems.

Microsoft and administration officials said the trial never came up during the White House visit. During the visit, Clinton spoke warmly about Gates's philanthropic activities and said they were an example of the ways the wealth created by the new economy can benefit society.

Gates's visit to Washington coincided with the beginning of a campaign by Microsoft to rally public support. On Wednesday the company began airing prime-time television ads featuring Gates that are aimed at beefing up its image after Jackson's verdict.

"Our goal at Microsoft," says Gates, casually dressed in the commercial, filmed at company headquarters in Redmond, Wash., "is to create the next generation of software, to keep innovating and improving what we can do for you. The best is yet to come."

The Justice Department and 19 states have until April 25 - with a built-in extension until April 28, if needed - to decide what remedies to seek in the case.

Microsoft must reply to the proposal in May and on May 24 Jackson will hold a hearing before making his ruling, probably sometime this summer. The government could seek to send the appeal directly to the US Supreme Court, an idea Jackson encouraged.

Justice Department spokeswoman Gina Talamona said the White House had not been involved in the case "to date," but she declined to say whether the president or his staff would be briefed on a remedy plan. Attorney General Janet Reno will participate, Talamona said. "She's the final decision-maker for the department," Talamona said.

Jackson found that Microsoft had used the monopoly power afforded by its Windows operating system to trample competition, had done "violence" to innovation and in the process harmed consumers. He also said that Microsoft had attempted to monopolize the market for Internet browsers in its battle with Netscape Communications Corp., now a part of America Online Inc.

Clinton has not been known to step in on antitrust matters. Federal Trade Commission Chairman Robert Pitofsky, who is one of the government's top two antitrust enforcers, said the Clinton White House has been careful to avoid interfering in antitrust cases.

"Never once has anyone in the White House said anything pro or con (to the FTC) on an antitrust matter," Pitofsky said Thursday.

Presidents rarely involve themselves in antitrust cases. President Richard M. Nixon attempted to intervene in certain antitrust enforcement matters on behalf of campaign contributors.

President Ronald Reagan heard from other administration officials on the AT&T case, but in the end deferred to his antitrust chief, Bill Baxter, who sought and won a breakup of the phone giant.

"There isn't anything to be gained politically by getting involved," said William Page, a scholar of antitrust enforcement at the Mississippi College School of Law. "If it became known, it would suggest that the process is intrinsically political and people want to believe that antitrust is based on principle."

George Washington University law professor William Kovacic, another scholar of antitrust enforcement, said interference could come from Congress, where the chairmen of the Judiciary and Commerce committees in both houses are planning to hold hearings on remedies soon.

"Ultimately, they have no (direct) influence," Kovacic said. But Congress can "intimate the Justice Department that if they're not careful, you can take away lots of their resources and diminish their role in the future."

Yesterday, Joel Klein, chief of the department's antitrust division, referred to Microsoft during his presentation before the American Bar Association's annual antitrust meeting and thanked the group for opposing the company's attempts to convince Congress to slash the antitrust division's budget.

"If Americans are to have confidence in our legal system, the laws must apply to everyone," Klein said. "Politics can have no place in the enforcement of the antitrust laws."

Questions still remain about whether the Justice Department and the states will come to a consensus on what remedies should be imposed on Microsoft, though Iowa Attorney General Tom Miller, a Democrat, said it was his "hope" that the states and federal attorneys could agree.

This week, Sen. Robert G. Torricelli, D-N.J., who has become an adamant Microsoft supporter, urged the Justice Department to make its decision without the guidance of the states and suggested the federal government should take the lead in jump-starting settlement talks.

"The Department of Justice has some incentive to get the case settled, because it is in the national interest," Torricelli said. "The states' attorneys general have virtually no interest in reaching a settlement. Most of them are political candidates. They get a lot more attention in the lawsuit. There is no need for them to have this litigation end."

Miller said the senator's comments showed "a total lack of understanding of the case" and that the attorneys general were motivated by "nothing other than to provide the best remedy for the citizens of America."

An official from one of the states said Thursday that no decision had been made about what remedy to seek. While the idea of breaking up Microsoft into smaller companies has been popular among some of the state attorneys general, this official suggested that officials had growing reservations about the idea.

"I think that people have grappled a little more directly with what the practical difficulties are, what the reaction may be from the courts, what the implications are on appeal," the official said.

Mark Popofsky, a former Justice Department official, said that the process of fast-tracking Microsoft's appeal to the Supreme Court might work against a breakup, largely because splitting up the company would require a more thorough and lengthier appeals process.

Staff writer Ariana Eunjung Cha contributed to this report.

Reported By The Washington Post, http://www.washingtonpost.com.