RealTime IT News

Court Touts Microsoft's Settlement Compliance

WASHINGTON -- U.S. District Judge Colleen Kollar-Kotelly said Monday she was pleased with the results of the first status report on Microsoft's compliance progress under its landmark 2002 antitrust settlement between the company and the Department of Justice (DOJ).

"On the whole, it is a positive report. We have a system that's in place that's moving along," Kollar-Kotelly, who presided over the settlement and is charged with its enforcement, said in a brief open court session.

The report is part of semi-annual status updates mandated by the settlement agreement over antitrust violations, and was written by both the DOJ and Microsoft .

The report particularly notes Microsoft's progress in reaching agreements to license key parts of its operating system to competitors. The settlement requires Microsoft to make available licenses to communications protocols on reasonable and nondiscriminatory terms.

Microsoft identified more than 100 protocols for license and developed a program known as the Microsoft Communications Protocol Program (MCPP). Under the program, Microsoft provides licensees with technical documentation that describe each communication protocol, as well as licenses to Microsoft's relevant patents, copyrights and trade secrets pertaining to the licensed Microsoft technology.

According to the report, the technical documentation that Microsoft developed comprises more than 5,000 pages and was produced by approximately ten technical writers working full-time for nine months.

The report states that the DOJ received "numerous" complaints about the initial MCPPs being "overly stringent."

In response, Microsoft has eliminated requiring potential licensees sign a non-disclosure agreement in order to review the licensing terms and improved the terms regarding the timing of technical disclosures so that licensees are able to obtain information at the same time as other licensees and Microsoft partners.

In addition, the report notes, "Microsoft is undertaking changes to the MCPP's royalty structure and rates, which will result in further changes to the licensing terms. The report adds, however, the DOJ remains "concerned about the royalty structure and rates proposed by Microsoft."

Overall, the report states that the DOJ has received 194 complaints about the settlement agreement, Microsoft's compliance efforts or the government's enforcement of the agreement. Out of those, the DOJ has classified 18 of the complaints as substantive that required some manner of investigation. The majority of the complaints focused on the MCPP.

Kollar-Kotelly's blessing of the status report is another piece of recent good legal news for Microsoft. Last month, the U.S. Court of Appeals in Washington upheld Kollar-Kotelly's decision to approve the settlement negotiated between Microsoft and the DOJ in 2002.

Nineteen states had sued Microsoft for better terms following the initial settlement. Massachusetts, the only state to not eventually reach an agreement with Microsoft, claimed Kollar-Kotelly erred in her decision in not barring Microsoft from tying software like its Web browser, e-mail client and media player with its operating system.

Massachusetts state attorney Jesse Kaplan, who attended Monday's hearing, told reporters the state has not decided if it will appeal the decision.