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Mud flies as Microsoft brief goes for Intel exec's throat

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Relationships within the Wintel alliance have been much more hostile than had previously been realised, it emerged during the third day of Intel VP Steve McGeady's evidence. The most acrimonious cross-examination so far took place yesterday when Microsoft attorney Steve Holley of Sullivan & Cromwell tried to give McGeady a rough time in the witness box. At one point, Judge Jackson intervened and admonished Holley about one of his lines of questioning: "What is the point of this? What are you trying to demonstrate? Are you just trying to embarrass him?" The judge also wanted to know if McGeady was in the court "with the blessing of your CEO". McGeady replied that "blessing" would be too strong a word, and when the judge asked to what extent he was testifying for Intel, McGeady said "in some cases", although he admitted that his presence in the court did not help Intel's relationship with Microsoft. Holley has a distinguished history of shady and ungentlemanly behaviour during an earlier phase of the DoJ case against Microsoft, and we shall return to this later. Several contentious issues that arose today show that the pot was indeed calling the kettle black. Holley accused McGeady of insulting Andy Grove by calling him "Andy 'Mad Dog' Grove" in an email to James Clark, chairman of Netscape. However, Andy Grove has declared himself to be paranoid in his book Only the Paranoid Survive, so the remark to Clark is of little importance and cannot realistically be interpreted as being vindictive. McGeady discussed with Clark whether he should testify for the government, if asked. A video of Ron Whittier, McGeady's boss, noted that he (Whittier) had heard Microsoft executives claiming their policy was to "embrace and smother" competitors, which supported McGeady's testimony. Holley challenged McGeady about not having written down in his notes Maritz' remark that Microsoft should "extinguish Netscape's air supply" [ie. browser revenue]. McGeady said that there was no danger that he would have forgotten such a remark. Holley also accused McGeady "that he didn't add [the words 'embrace, extend, extinguish'] to [his] notes because you made them up later". (See also Intel exec made up quotes, says Microsoft attorney.) McGeady stood his ground: "This is absolutely untrue and I resent the implication." Holley tried to establish that McGeady was repeating the air-supply remark from something that Larry Ellison had said, which allowed McGeady to quip that "I haven't learned much from Larry" and then disclose that he [McGeady] had leaked the story to the New York Times, which published it in January this year. Holley produced an evaluation from Frank Gill, McGeady's then-boss, that accused McGeady of having "fucked things up" and suggesting that McGeady was a "prima donna". But it was after all Maritz who had noted that "unfortunately McGeady has more IQ than most [Intel people]". If this was apparent to Maritz from brief meetings with McGeady, it would have been even more apparent to the presumably lower-IQ execs at Intel, who may well have resented this young upstart. McGeady directed the software group of IAL, but had a leave of absence later in 1995 to do some research at MIT Media Labs. McGeady said that one reason for his sabbatical was that Microsoft had requested that he not be part of some joint Intel-Microsoft programmes. Holley tried to establish that this move was a result of "irresolvable difficulties" with his superiors, and produced notes from a meeting with Frank Gill, an Intel exec in which Gill complained of McGeady's "belligerence towards Microsoft". Holley took exception to McGeady having entitled one of his memoranda "Sympathy for the Devil". It turned out that McGeady had thought of the title because Microsoft had chosen the Rolling Stones song 'Start me up' to launch Windows 95 (and paid $4 million for the pleasure, although higher payments have been claimed): McGeady was just using the title of another Rolling Stones' song as a "literary allusion". To Holley's considerable embarrassment, he recited a verse: "If you meet me, have some courtesy, have some sympathy, have some taste. Use your well-earned politesse, or I'll lay your soul to waste." McGeady's explanations seemed to be logical enough, and certainly well within Microsoft's own rules of tough but fair play. But this is not the end of the story, which now requires some Register time warp. It was a matter of great embarrassment when Holley, who acted for Microsoft in the first antitrust case, was caught passing a document filed-under-seal to Linda Himelstein, then Business Week's legal editor, in September 1995. Although the document concerned another case, it emerged that Holley could be subject to contempt of court proceedings, and that his firm had lax procedures for handling confidential materials. It was revealed by Milo Geyelin in the Wall Street Journal [Law firm's gaffe over sealed records, 4 October 1995] that Holley contradicted testimony from Himelstein, with the result that a Business Week lawyer produced to a court records of some dozen conversations that Holley had had with Himelstein. It was there recorded, and thus came to public knowledge, that Holley had criticised an outfit worn by Anne Bingaman, the former DoJ head of antitrust, who had negotiated the consent decree with Microsoft. The notes also show Holley "making biting personal snipes about Ms Bingaman and saying that 'everyone on her professional staff thinks she's out of her mind'." To make matters worse, Holley was appointed to the New York City Bar Association's Committee on Professional and Judicial Ethics in 1992, but had hardly acted ethically himself. But that was not all. Holley, it seemed, had been a regular deep throat to Business Week during the Microsoft antitrust case. Sullivan & Cromwell apologised publicly, but the damage was done. It is most unwise of Microsoft to unleash an attorney whose own ethics are demonstrably wanting. David Boies, the DoJ's trial attorney, may himself be in a spot of personal trouble. He is being investigated by the Federal Election Commission for asking friends to donate $1,000 to a Democratic candidate, and then reimbursing some of these amounts subsequently, because they were potentially violations of campaign-finance law. Boies says he didn't reimburse anyone. The original complaint apparently came from opponents of Boies. Surely he has not been set up by some malevolent person or organisation? ® Complete Register trial coverage

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