November 24, 2004
Antitrust and K-Mart-Sears merger
Senator DeWine (R-Ohio) and Senator Kohl (D-Wisc) last week urged the DoJ to scrutinize the K-Mart Sears merger for potential antitrust violations. This article from Money magazine reports on the story. The merger raises some interesting issues about the role of the failing firm defense against anti-competitive mergers.
Unexpected meeting in EU Microsoft case
"BRUSSELS, Belgium (AP)-The judge deciding whether to suspend the European Union's antitrust order against software giant Microsoft Corp. pending appeal has called an unexpected meeting, two weeks after two longtime backers of the EU's case abruptly pulled out. Judge Bo Vesterdorf, president of the European Court of First Instance in Luxembourg, called a closed-door session for Thursday to discuss "procedural matters," the court said Tuesday. Court officials declined to elaborate. EU and Microsoft spokesmen had no immediate comment.
"A person familiar with the matter, speaking on condition of anonymity, said the judge apparently wanted to "figure out what the significance is" of the Nov. 8 defection from the EU side of Microsoft rival Novell Inc. and a Washington-based trade group, the Computer and Communications Industry Association.
"Microsoft Corp. paid Novell $536 million and an undisclosed smaller amount to the CCIA to pull out of the EU case.
"Both supported the European Commission in its investigation, which ended in March with a decision ordering far-reaching changes in Microsoft's business practices as well as a fine of 497 million euros ($646 million).
"Vesterdorf is expected to rule within weeks on Microsoft's request to suspend the order, pending its appeal of the decision.
"The EU has insisted the defections would not affect its defense of its decision.
"Microsoft, based in Redmond, Wash., has settled with four of the five major intervenors in the EU's case, having previously spent $2.4 billion settling claims by Time Warner Inc. and Sun Microsystems Inc.
"The last big opponent, RealNetworks Inc., maker of a rival to Microsoft's digital Media Player application, denied Tuesday that it and the EU were becoming isolated.
"David Stewart, a senior lawyer with RealNetworks, told Dow Jones Newswires that it and other companies 'remain resolved to support the decision and protect consumers.'
"In announcing its settlement, Novell said the agreement resolved its claims involving the Netware operating system for connecting computers across networks, which competes with Microsoft's dominant Windows software.
"Novell said then it would go ahead with an antitrust lawsuit in the United States against Microsoft over damage a decade ago to its once-popular WordPerfect business software.
"The CCIA, which has fought Microsoft vigorously on legal fronts for more than a decade, did not disclose the size of its payment, but said Microsoft would spend $65,000 to become a member.
"Ed Black, the group's head, declined to comment Tuesday. "