DOJ Rebuffed in Microsoft Appeal

In a setback for the U.S. Department of Justice (DOJ), the U.S. Court of Appeals for the District of Columbia Circuit denied a request that the court relinquish jurisdiction over the Microsoft antitrust case.

The DOJ had argued that Microsoft should not have taken its motion for a stay directly to the appeals court before the trial court had an opportunity to rule on it. The motion relates to the harsh restrictions on Microsoft’s business practices that are set to go into effect September 5th.

The government argued that because it had filed a petition for the direct appeal to the U.S. Supreme Court, the appeals court should take no further action in the case. Finding the argument without merit, the appellate court ruled that it would retain jurisdiction in the case.

Direct Appeal

The victory for Microsoft was dampened by the fact that the appellate court also ruled that U.S. District Judge Thomas Penfield Jackson is the proper authority to decide whether the case will be certified for direct appeal to the U.S. Supreme Court. If the trial judge does certify, the U.S. Court of Appeals will stay its own jurisdiction pending a decision by the Supreme Court on whether the high court will hear the case.

If Judge Jackson agrees with the DOJ, Microsoft will be forced to take its appeal directly to the Supreme Court.

Briefs on Restrictions Issue

In Monday’s ruling, the appellate court set a schedule for addressing Microsoft’s motion to stay the court-ordered restrictions on its business practices.

The government must file a reply brief in the next 10 days, and Microsoft a week later. If the trial judge certifies the case for direct appeal, however, the briefing schedule on the motion for stay would itself be stayed.

Delay Tactics

Still, Microsoft did not score the decisive victory it had sought by going to the appeals court. Lawyers for the Redmond, Washington-based software giant were hoping that the appeals court would decide to take full jurisdiction, which many observers believe would make the overall appeal process take longer than a direct appeal to the Supreme Court. However, both sides continue to accuse the other of using delay tactics.

“The appeals court did not accept the government’s invitation to delay, which we are pleased about,” said Microsoft spokesman Jim Cullinan. “We are pleased about this because we want to get this appeal process moving as quickly as possible, which is contrary to what the government’s strategy seems to be.”

Next Step

Microsoft is expected to file a response to the government’s petition for direct appeal, arguing that federal law does not allow the state’s portion of the case to be taken directly to the Supreme Court.

However, even if Judge Jackson does certify the case, the Supreme Court is under no obligation to accept the case and could send it back to the appellate level. The high court is expected to make a decision on hearing the case by the first week of October.

Depending upon the actions taken by the three courts involved, one possible scenario is that the trial court certifies the case, the appellate court stays the briefing on the motion to stay the business restrictions, and the restrictions go into effect in September before the U.S. Supreme Court decides in October whether it will hear the case.

However, if that scenario starts to unfold, analysts believe that the Supreme Court would issue a temporary stay of the trial court order.