Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, April 25, 1995                   TAG: 9504260064
SECTION: BUSINESS                    PAGE: B-6   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

MICROSOFT HAS ITS DAY IN COURT

A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit is reviewing the proposed settlement with the software giant. The court heard 90 minutes of oral arguments and may take several weeks to reach a decision.

The settlement, reached last July after a four-year government investigation, would require Microsoft to end a discounting practice that effectively reduced competition in selling operating software to makers of personal computers.

In addition to studying the agreement, the appeals court decision is likely to define further the scope of antitrust review a federal judge has under a law known as the Tunney Act.

U.S. District Judge Stanley Sporkin, in rejecting the settlement Feb. 14, said he could not rule it met the Tunney Act's definition of being in the public interest because he had insufficient information from the company and Justice Department.

During his review, Sporkin raised questions about Microsoft practices that he had read about in a book. He also allowed competitors and a trade group to present objections after the normal Tunney Act review expired.

Sporkin suggested several modifications to the settlement but they were rejected by Microsoft.

In the appeal, the Justice Department said Sporkin's questioning broadened the case beyond what its prosecutors had decided. It said the judge could not force it to bring a case nor disclose the complaints about Microsoft that the government considered but did not pursue.

While Microsoft and the Justice Department stood together at the appeals hearing, they may be on different sides again soon.

The department is reviewing Microsoft's proposed $1.5 billion acquisition of Intuit Inc., maker of the personal finance program Quicken. Several competitors have objected to the deal, saying Microsoft would be able to take advantage of its dominance in operating system software to become strong in the emerging market of on-line financial transactions by consumers.

Microsoft has given the Justice Department notice that it has provided all relevant documents on the matter, The Wall Street Journal reported last week. In so doing, a 20-day deadline was invoked for the department to make a decision on the deal.

Microsoft's chief counsel, William Neukom, declined to confirm the report, however, and would not say if the company has provided all the Intuit-related documents to the department.