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Dole building anti-MS coalition

Microsoft's legal wrangle against antitrust regulators and competitors now faces a high-profile political foe: former presidential candidate Bob Dole.

Microsoft's (MSFT) legal wrangle against antitrust regulators and competitors is increasingly moving beyond the courtroom--this time to Capitol Hill in the form of 1996 Republican presidential candidate Bob Dole.

Competitors such as Netscape (NSCP) have hired the Washington, D.C., See special report: MS-DOJ case in court law firm of the former Senate Majority leader, Verner Liipfert Bernhard McPherson & Hand.

Dole, who was retained six weeks ago by a company concerned with Microsoft's actions, has launched a coalition-building effort with companies and organizations concerned that the software giant is infringing on fair competition in the marketplace. The group's goal is to educate legislators and the public on this issue, according to a source familiar with Dole's strategy.

The move comes at a crucial moment for Microsoft. The Justice Department succeeded in getting a federal court judge to issue a temporary injunction against the company, prohibiting it from requiring computer makers to carry its browser software in order to obtain a license for Windows 95 and its successor. Now, the DOJ has charged Microsoft with contempt of court, alleging Microsoft with violating that injunction.

Microsoft filed a response to those claims today, contending the Justice Department misunderstood the technology and waffled in its position. It also accused the judge of acting improperly in having a consultant remove the IE browser from a court computer. (See related story)

Lining up political firepower, Netscape and roughly half a dozen other companies have hired Dole's firm.

Meanwhile, Microsoft's political ammunition includes former Congressmen Tom Downey from law firm Downey Chandler, and Vin Webber of law firm Clark & Weinstock. Both have served on the House Ways and Means committee.

"We will certainly intensify our [lobbying] efforts in response, so [legislators] will hear our side of the story," said Mark Murray, a Microsoft spokesman.

Dole could not be reached for comment. A spokesman's for Dole's firm declined to elaborate on the former senator's actions.

But Dole apparently is hoping to gain enough support by the time Congress resumes on January 27. The former senator wants to solidify the coalition in order to appear before Congress.

The group, currently in the development stages, seeks to become a coalition because it would be easier to manage and would allow companies to offer behind-the-scenes support without publicly disclosing their names, the source said.

"There has been some success and support among companies, but also some hesitation," noted the source familiar with the situation. This is similar to what the DOJ has encountered, as some companies that do business with Microsoft are reluctant to come forward with business details about the software giant.

Dole's involvement with these efforts began after a company retained his firm. "After initial discussions, there was a realization that there was more than competitors that had an interest in this. So there was an opportunity to talk to other people who would be affected, like people involved with [e-commerce]," added the source.

Murray declined to comment on Dole's action, but he expressed concern over competitors' actions on Capital Hill.

"We think it's unfortunate our competitors are pouring so much of their energy and resources in generating anti-Microsoft sentiment in Washington," he said. "We think it's a very shortsighted approach...They should put their efforts in building better products to compete in the marketplace."

In a recent article that appeared in the opinion pages of the Los Angeles Times, Dole penned a piece that argued Microsoft must obey antitrust law: "Microsoft should not be hindered unnecessarily in legitimate competition by government overregulation, but it cannot be allowed to use its current dominance in personal computer operating system software to preclude competition," he stated.

His opinion article also noted that while he questioned the breadth of the government's actions against Microsoft in the 1995 consent decree, he considers the issue today stands on a different level.

"As I review what is at stake today--nearly total domination of one of the primary means of commerce for the coming century--I can only come to the conclusion that no one company should be allowed to dominate the Internet," he wrote.

But when he appeared before Congress in 1995, according to the congressional record, Dole said: "Let us understand what is going on here. A company develops a new product, a product that consumers want. But now the government steps in and is in effect attempting to dictate the terms on which that product can be marketed and sold. Pinch me, but I thought we were still in America."