Court documents do not record what Bill Gates said to Anne Bingaman on the telephone last July when the software titan and the trust-busting Assistant Attorney General finally struck a deal. Gates had made little secret of his anger at the Justice Department for looking into Microsoft's empire and the sometimes ferocious tactics it has used to build it. At one point during an earlier antitrust investigation by the Federal Trade Commission, Gates lost his temper and started shouting at the commissioners. It was only after the Justice Department issued a "We'll see you in court" ultimatum-and then let the deadline slip by a day-that Gates finally agreed last summer to settle.
In public statements issued afterward, the relief on both sides was palpable. "We got everything we could have hoped for," said Bingaman. Microsoft, for its part, declared the deal "reasonable," all the while insisting that the company had done nothing illegal and was going along only to avoid what could have been the biggest antitrust case since the government tried-and failed-to break up IBM in the 1970s. All that was required to seal the agreement was a review by a federal judge.
But what Gates and Bingaman could not have foreseen is that the case would land before the ornery intellect of Stanley Sporkin-a former chief of enforcement at the Securities and Exchange Commission who never learned the meaning of the words "It's none of my business.'' The more Sporkin learned about Microsoft in hearings that began last fall, the less he liked the settlement that Gates and Bingaman had worked out and the role that he, as the reviewing judge, was being asked to perform. "I will not be played for a fool," he warned during a heated session last month.
Thus the stage was set last week for one of the most bizarre confrontations in the history of American antitrust enforcement-one that could derail the strategic plans of the world's largest PC software company while raising questions about how effectively the U.S.-or any government-can control monopolies carved in silicon, software or the borderless regions of cyberspace.
On Tuesday, Judge Sporkin flatly rejected the consent decree-a rebuke of the kind not seen since 1982, when Judge Harold Greene ordered that the AT&T breakup agreement be modified to boost the competitive chances of the Baby Bells. Then, two days later, Attorney General Janet Reno appealed Sporkin's decision, vowing to fight it, with Microsoft's help, in court. In effect, the trust busters had become the allies of the trust they had vowed to bust.
While Sporkin's decision may be on shaky legal ground, he gave voice to a growing concern in government and industry about the role Microsoft plays in the country's fifth largest industry. And his pointed inquiries seem to have taken him closer to the heart of the problem than the ftc and Justice Department managed to get after more than four years of investigation. "It is clear to this court," Sporkin wrote in an impassioned, 45-page decision, "that if it signs the decree presented to it, the message will be that Microsoft is so powerful that neither the market nor the government is capable of dealing with all of its monopolistic practices."