Harvard professor mutes antitrust skepticism

In a report in today's Washington Post, Lessig reportedly said he was "skeptical about breakup" and that such an action by the government didn't "seem logical."

But in an email exchange today, Lessig clarified exactly what he meant.

"What I said was: One, I have done my time in this case and am looking forward to being released for good behavior; two, I have not studied the issues enough to say anything serious; but, three, my bias is to be skeptical about a breakup," Lessig wrote.

"I would have thought one and two would have entailed that three was not newsworthy. I still believe that, and don't want to tempt non-newsworthiness anymore," he continued.

Lessig's perception about what to do with Microsoft could change the ultimate outcome of the landmark antitrust trial or ongoing settlement talks, said legal experts. The antirust trial's presiding judge, Thomas Penfield Jackson, has twice called on Lessig, as special master in a previous Microsoft case and to write a brief for the current one.

"Since everyone knows the judge has tremendous respect for Lessig, if Lessig honestly, sincerely and thoughtfully believes break up is not appropriate, then that's got to influence the judge," said University of Baltimore School of Law professor Bob Lande. "Since that influences the judge, then that, therefore, will influence the government to be more flexible in its demands during negotiations."

Lessig's influence could clearly be seen in court this week as the trial entered its final phase before Jackson's ruling, which is expected as early as two weeks.

Jackson had asked Lessig to file a brief about whether Microsoft had illegally tied Internet Explorer to Windows 95 and 98 so it could dominate the Web browser market. Read one way, the brief supported the government's claim, but read another way Lessig appeared to side with an appeals court ruling that would let Microsoft off the hook.

The judge questioned lead attorneys--David Boies for the government and John Warden for Microsoft--at length about the brief and the tying claim.

"I would have to say Lessig's brief greatly affected Judge Jackson," Lande said.

George Washington University Law School professor Bill Kovacic said Lessig's comments could shake up ongoing settlement negotiations. "The government will pay close attention to that story today," he said.

Judge Richard Posner, who heads the U.S. Court of Appeals for the Seventh Circuit in Chicago, has there been brokering settlement discussions between Microsoft and the government.

Posner's role in the initial phases of negotiations dealt with bringing together different philosophical points of view that made settlement nearly impossible, said sources familiar with the talks. But progress has slowed in recent week as Microsoft failed to put enough on the table to satisfy the government, and trustbusters held to their determination to breakup Microsoft, sources said.

But any event that increases "the government's perceived" risk that it won't get as much as it hopes from Jackson could soften its stance in negotiations, Kovacic said.

The remedy phase--what to do about Microsoft's alleged antitrust violations--won't begin until after Jackson's ruling. Most legal experts, including Kovacic and Lande, expect the judge to rule against Microsoft.

The debate over whether to breakup the software giant or simply restrict its behavior is expected to be a fierce one.

In a recent email sent to congressional offices, Microsoft referred to breaking up the company as a "regulatory death sentence."

But some legal experts think breaking up Microsoft would be in the best interest of the company and its shareholders.

"Divestiture has always been regarded as the sure, leaner remedy for monopolization," said Glenn Manishin, an antitrust attorney practicing in Washington. "In contrast, any kind of rules governing API disclosure or other Microsoft behavior would be a black hole of judicial regulation."