Business: The Case of the Century

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On the last working day of the Johnson Administration in January 1969, the Justice Department filed suit against International Business Machines, accusing it of monopolizing the "general purpose" computer business. Specifically, IBM was charged with trying to force customers to buy entire IBM systems for commercial use, and with keeping competitors out of the market. A decade later U.S. vs. IBM is still droning on, a costly monument to the law's delay. The frustrating case, Yale Professor Robert Bork told TIME'S conference, is the antitrust division's "Viet Nam." Thomas Barr, the Cravath, Swaine & Moore attorney who is leading the IBM defense, explained at the meeting why he sees no light at the end of the tunnel.

For three years after its complaint was filed, Barr recounted, the Government did almost nothing. Pretrial "discovery," which allows lawyers to search for facts and find out what evidence the other side plans to use, did not begin until 1972. For the next two years, each side deluged the other with paper, 30 million pages worth. After several delays, the trial began in 1975 in U.S. District Court in Manhattan. It took the Government almost three years to present its case; one witness alone testified for 78 days.

Yet, Barr said, the case is now "almost dead in the water." Reason: the Government insisted on yet another round of discovery starting last year. Federal attorneys began deposing IBM witnesses again and requesting even more documents. Queried by TIME, the Government's chief lawyer in the case, Robert Staal, insisted that in order to cross-examine IBM's witnesses, the Government needs to know what IBM has been doing in the computer industry since 1974, when the first round of discovery ended. But Barr contended that since the case started, the Government has brought in a whole new team of lawyers, who had to educate themselves. Scoffed Barr: "This is a continuous reinvention of the wheel."

The case has also been a. man-eater for IBM and its law firm. In order to recruit top law school graduates, Cravath has constantly had to boost starting salaries (this year: at least $30,000); the grads fear becoming stuck on the IBM case, which is widely seen as a black hole for fledgling legal careers. Those who are assigned to the case get up to $5,000 extra combat pay annually.

Assistant Attorney General John Shenefield has repeatedly told Congress that his antitrust division is trying to speed the case. But it is difficult to see how. This winter, Barr recounted, the Government subpoenaed IBM Chairman Frank Cary to produce virtually every document relating to computers accumulated by the company since 1973. That amounts to 5 billion pieces of paper, said Barr, who claims that to comply would take 100 lawyers 620 years working full time. Staal, however, called Barr's figures "grossly exaggerated" and contended that the parties could easily work out a compromise, but that IBM refuses to negotiate.

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