Appeals court could favor Microsoft

Far from ending the case, the judge's order to break up the software giant is the beginning of a protracted appellate process that could eventually decimate the government's initial victory.

5 min read
WASHINGTON--Microsoft may have good reason for boasting that it will prevail on appeal.

Far from ending the case, U.S. District Judge Thomas Penfield Jackson's order to break up the software giant is the beginning of a protracted appellate process that could eventually decimate the government's initial victory.

Now, the case is expected to go in one of two directions: to an appeals panel made up of three judges yet to be chosen or directly to the Supreme Court through a special government petition.

"There's just no legal analysis on the legal standards for remedies. None at all," said professor Bob Lande of the University of Baltimore Law School. "I think this makes it more likely the that Supreme Court says, 'Let's see what the court of appeals has to say about this case.'"

In the end, the case's outcome may be less about antitrust law and more about conservative vs. liberal politics. Conservatives dominate the local appeals court here, which would more likely side with Microsoft, while the Supreme Court's more moderate mix would be better for the government, legal analysts say.

Even if the case goes to the appellate court first, it may well be destined for a Supreme Court appeal again if the losing side thinks it has sufficient grounds. Most experts conservatively estimate an appellate process lasting nine months and more likely a year, with the Supreme Court taking another year--pushing a final decision to about June 2002 at the earliest.

Special coverage: Breakup By that time, the makeup of justices on the high court may have changed, adjusting the odds for the case. That brings this year's election into play, as any new jurists would be chosen by a new president.

The appellate process begins when Microsoft files a one-page "notice of appeal," something it is not compelled to do right away but must complete within 60 days of Jackson's judgment today.

The government can then request that the Supreme Court take the case directly under the Expediting Act, in concert with the solicitor general and with the consent of Jackson. Sources close to the government say the solicitor general would likely approve the petition.

If Microsoft files its appeal quickly, the Supreme Court would likely announce sometime in September or as late as the first week of October whether it would take the case. A Supreme Court decision to hear the case would sidestep major problems for the government at the local appeals level and potentially bring the case to a close next year.

"But it's uncertain whether see full text of Judge's final ruling the Supreme Court would take the case or not, and people are speculating on both sides about this," said Lars Liebeler, an antitrust attorney with Thaler Liebeler Machado & Rasmussen here. He said Microsoft could wait until the end of the 60 days to file its notice of appeal as a stalling tactic.

Professor Bill Kovacic of the George Washington University School of Law agreed that it would be a savvy move and one that could make it more difficult for the Supreme Court to act in the autumn session. "If Microsoft wants to hold the ball, they don't have to file immediately and can wait," he said.

If the Supreme Court chooses not to hear the case, it goes back to the local level, the U.S. Court of Appeals for the District of Columbia Circuit. Of the court's 11 rotating jurists, seven are conservative judges who legal experts say would be more sympathetic to Microsoft.

"The choice of the panel that will hear any appeal from Jackson to the D.C. Circuit is crucial," Kovacic said. "The Republicans have better numbers."

The same court also took sides with Microsoft--and against Jackson--in an earlier decision, overturning a preliminary injunction against the company and slapping the judge's wrists in the process. In that case, the appeals court faulted Jackson for issuing a temporary order that compelled Microsoft to sell its Windows 95 operating system separately from its Internet Explorer Web browser.

Court analysts point to that experience in explaining why the selection of judges on the panel is crucial. "Certainly a conservative mix would be tough on the government," Lande said.

The conservatives, all Reagan-Bush appointees, are Douglas Ginsburg, Stephen Williams, Laurence Silberman, Karen Lecraft Henderson, David Sentelle, Raymond Randolph and James Buckley, who is senior judge. The liberals, all Carter-Clinton appointees, are Harry Edwards, Merrick Garland, David Tatel and Judith Rogers.

Two conservative antitrust heavyweights stand out: Ginsburg and Williams. The former antitrust academics are well versed in the statutes and economics of antitrust law and would largely favor Microsoft, legal experts say.

"If those two judges appeared on the panel, Microsoft's prospects of whittling down the government's victory before Jackson increase significantly--enough to sidestep a breakup and possibly much more than that," Kovacic said.

See MS-DOJ timeline The selection of the original panel is important for another reason: This appeals court does not generally accept cases before the full 11-judge panel. Either side could make such a request after the three judges issue their decision, but given its history the court is not likely to grant it.

Another possible scenario would put the case before the three judges who heard the appeal in the earlier case. "There is a rule the case could be assigned to a specific panel if it is a related matter," Kovacic said. If the previous panel heard the case, "it would be a very good day for Microsoft because of their wonderful treatment of the bundling claim," Kovacic said.

Not all legal experts believe the political leanings of the judges matter when the case is evaluated on its merits.

"I think people are being fast and loose with these conservative and liberal labels with respect to the appeals panel," said Rich Gray, an intellectual property attorney with Outside General Counsel Silicon Valley in Menlo Park, Calif.

As an example, he points to Jackson himself, who is a Reagan appointee.

The same can be said for the Supreme Court as well. In terms of ideology, the high court is generally thought to be conservative, with seven out of nine of the justices appointed by Republican presidents.

Learn more about the landmark antitrust case and what's next this weekend on
CNET News.com TV

Saturday and Sunday, June 10 and 11, 4 to 5 p.m. ET on CNBC

But the conservative majority is less overwhelming than it seems. Justices David H. Souter and John Paul Stevens--nominated by Presidents Bush and Ford, respectively--have been known to join Carter nominees Ruth Bader Ginsburg and Stephen G. Breyer in some split decisions.

Only in rare instances has the liberal bloc secured a winning fifth swing vote, however. Chief Justice William H. Rehnquist and Justices Antonin Scalia and Clarence Thomas have been the court's bedrock conservatives.

If the court is sharply divided on how to handle a Microsoft breakup, the votes of Justices Sandra Day O'Connor and Anthony M. Kennedy could prove key--the two have been identified as crucial swing votes in recent years. Still, the pair have most frequently fallen in line with the conservative side of the court, which is firmly lead by the chief justice.

News.com's Evan Hansen contributed to this report from San Francisco.