Microsoft Goes Back on the Offensive

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WASHINGTON: Microsoft has fired its first shot in the courts since the Department of Justice and 20 states began their antitrust suit, and it seems that Bill Gates's time as Mr. Nice Guy may have been short-lived. The software giant's filing Tuesday not only denies, point by point, each of the antitrust allegations against it, but countersues the states for a reimbursement of the company's legal fees in the case -- and demands a dismissal of the entire suit.

"Microsoft's opponents are calling this a return to the obnoxious days," says TIME Daily Washington reporter Declan McCullagh, "and the countersuit certainly doesn't seem to be a winner legally." But by aiming at the states -- claiming that they have no right to enforce federal antitrust law -- Microsoft has added a side issue that will soak up the states' limited resources and slow this case to a crawl. "The states will have to respond, and Microsoft will respond to that," says McCullagh. "It's gonna be a long trial."