Microsoft Empire Strikes Back

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Three weeks ago, it seemed as if Janet Reno may actually have found a chink in Microsoft's armor. The attorney general filed suit against the software behemoth, claiming they were bullying computer manufacturers into accepting Internet Explorer as part of the Windows 95 bundle in violation of a 1996 court order. But now the empire through its legal minions has struck back.

Monday night, Microsoft filed a 48-page brief in response to the DOJ's charges. Bill Gates is basically asking a federal judge to throw Reno's case out of court and he has some pretty powerful allies.

Tuesday morning Dell, Compaq and NEC Packard Bell followed suit, releasing statements saying their Windows 95 licensing agreements would not prevent them from packaging alternative browsers to IE on their computers.

Microsoft's defense hinges on language in the 1996 order that would allow it to integrate new functionality and software into Windows 95, even if the new product competed with software currently sold independently. "The government was fully aware of Microsoft's plans," said William H. Neukom, Microsoft's senior vice president for law and corporate affairs.

It will be days before we know if the judge swallows this line. Still, shareholders were cheered by the attack: Microsoft stock bumped modestly on the news, and finished up 7/16 at 130 5/8.

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  • The Netly News on the story from Washington.