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U.S. District Judge Thomas Penfield Jackson has issued his 17-page final judgment ordering the breakup of Microsoft Corp. into two companies. The court released the order at 4:30 p.m. Addressing the cameras at a Justice Department press conference at five o’clock, Joel I. Klein, the nation’s antitrust chief, was bullish about the prospects of an immediate review of the historic ruling by the U.S. Supreme Court under the Antitrust Expediting Act. The act provides for direct appeal of federal antitrust cases to the nation’s highest court, but the solicitor general must seek it. Klein said that the solicitor general “has authorized” that filing, and Judge Jackson has indicated he would approve it. Klein even suggested that his opponents at Microsoft should join the petition. “It would seem to be in everybody’s interest, frankly, to do that.” Meanwhile, in Redmond, Wash., Microsoft issued its own bullish press release announcing that it was “confident” that the decision would be overturned. It quoted the company’s chairman and co-founder, Bill Gates: “This is the beginning of a new chapter in this lawsuit,” he said. Saying the company has a “very strong case on appeal,” Gates called Jackson’s ruling “inconsistent with past decisions by the Appeals Court and the Supreme Court that support product improvement.” Jackson, too, is ready for an appeal. In a six-page memorandum accompanying his final judgment, he recognized that “there is a substantial body of public opinion, some of it rational” that agrees with Microsoft’s assertion that “the company has ‘done nothing wrong’ and will be vindicated on appeal.” The judge wrote that it’s time to “put that assertion to the test.” But he also made plain his reasons for ordering a breakup, after holding only one hearing on the subject of remedies on May 24: The company has proven that it can’t be trusted. In fact, Jackson saw the company’s claim that it was blindsided by the judge’s move toward a final order, without the benefit of more testimony and evidence, as more evidence of its untrustworthiness. “Microsoft’s profession of surprise is not credible,” he wrote. He added that “well-established Supreme Court precedents dating from the last century mandated that divestiture was a possibility, if not a probability, in the event of an adverse result at trial.” In the Microsoft press release, the company’s general counsel, William E. Neukom, said Microsoft was denied a “fundamental right” when Jackson rejected its motion for further discovery and suggested evidentiary hearings on remedies that would have begun in December. But Jackson, in his opinion, observed that Microsoft should have foreseen this eventuality during the course of the five-month mediation. His ire that the parties could not resolve their differences before U.S. Circuit Judge Richard A. Posner, was clear in the opinion. Microsoft’s “failure to prepare to meet such an eventuality gives no reason to afford it an opportunity to do so now,” he wrote. Klein’s comments at the press conference seemed designed, in part, to head off Microsoft’s inevitable claims on appeal that it was denied due process before the breakup order was imposed. “The court had an extraordinary record upon which to enter today’s order. Judge Jackson had this case before him for more than two years; he heard all of the testimony, and reviewed thousands and thousands of documents during the 78 day trial; he carefully weighed the evidence and made extraordinarily detailed findings of fact,” Klein said. Klein called the judge’s final order “fair” and “measured,” adding that it directly flowed from the findings and legal conclusions the court had previously entered.” Back in Redmond, Gates was repeating the mantra that the company will continue to “vigorously defend” its right to innovate. In his decision, Jackson blamed the “imperative” need for a structural remedy on the intransigence of Gates and his fellow executives. “Microsoft as it is presently organized and led is unwilling to accept the notion that it broke the law,” he wrote. With an appeal in the offing, either to the Court of Appeals for the D.C. Circuit, where Microsoft won handily before, or to the Supreme Court, Attorney General Janet Reno recognized the historic impact of Jackson’s ruling “by reaffirming the importance of antitrust law enforcement in the twenty-first century.” David Boies, the government’s special trial counsel, could not attend the press conference because he was in court in Florida. He is credited with delivering the government’s stellar victory. Klein ducked the question when asked whether Boies would remain on the government team for the appeal. (Klein himself is an accomplished appellate litigator, having argued a dozen cases before the Supreme Court.) Boies signed on for the trial only, and the caseload of his law firm, Boies, Schiller & Flexner, has exploded over the course of the trial. He could not be reached for comment at press time.

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