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Judge attacks ‘leaking and spinning’ in MS deal talks

And it seems a consent decree was in the works

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MS on Trial Judge Richard Posner has lashed out against the "good deal of leaking and spinning" that has plagued his mediation talks in the Microsoft case since November. Judge Posner ended his search for a negotiated settlement yesterday via a prepared statement, and the content of this is intriguing, in a Delphic sort of way. He makes it clear that the statement will be all he has to say on the subject, and says "I do not intend to make any public or private comments on the merits of the litigation, the negotiating positions of the parties, the individuals involved in the negotiations, or the content of any of the communications between the parties’ mediation teams and myself." But he says that the "leaking and spinning have given rise to news reports that have created a misleading impression of several aspects of the process and that should be heavily discounted by anyone interested in hewing to the truth." Posner doesn't name the culprits, and there's clearly been leakage from both camps; Microsoft's lobbying activities, the escape of at least some of the bullet points of the Microsoft proposal last weekend, and Steve Ballmer's suspicious email to staff could all be thought of as leaking by proxy. Nor are the DoJ's hands entirely clean, as it's been willing to go on the record with taciturn observations, if only in response to alleged Microsoft leaks. But maybe this is significant. Posner says: "I particularly want to emphasise that the collapse of the mediation is not due to any lack of skill, flexibility, energy, determination, or professionalism on the part of the Department of Justice and Microsoft Corporation." No name-check for the states? They haven't been in the forefront of the mediation talks, of course. The other interesting thing that Posner has to say is he wishes to correct the misleading impression that "there were no serious negotiations over possible terms of settlement until two weeks ago." He reveals that over the months a possible consent decree went through "almost 20 successive drafts." This means a deal was a lot closer than the outside world knew, but for some unspecified reason "it became clear late last night [i.e. Friday] that the case would not settle, at least at this stage of the litigation." Posner's statement begs numerous questions, none of which he's going to answer. First of all, if the drafting of a consent decree was well advanced, why did Microsoft make fresh settlement proposals just days before Judge Jackson was due to deliver his verdict? The confusion in the government camp last weekend, where the proposals were both rejected and described as a basis for negotiation, certainly made it clear they were new. But were they intended as a supplementary offer to whatever was already on the table in the draft decree, or as a replacement? And then there's the spinning itself. Posner says there were leaks, but clearly they were being spun into a misleading position, giving the impression that there was no likelihood of a deal. So who was it spinning in order to wreck the talks? The hawks pushing for a break-up that Microsoft wasn't going to accept? Or did Microsoft switch over to a PR spin approach a week ago, having concluded that it wasn't going to shift the hawks, and should therefore grit its teeth for the verdict while telling the world how many huge concessions it had been prepared to make? "We went the extra mile to resolve this case, but the government would not agree to a fair and reasonable settlement that would have resolved this case in the best interests of consumers and the industry," said Bill Gates in his prepared statement. But then if the offer was just PR spin, Posner surely wouldn't be lauding Microsoft's "flexibility" and "professionalism," would he? And he would have asked for, and got, that extension from Jackson. So after last Tuesday, they came close in the following days, until it all fell apart on Friday night. At the moment we've only got Bill for raw material on this, but although he'll be entering spin overdrive now, it has a ring of truth to it: "Microsoft offered significant concessions in the interest of ending this case. Ultimately, it became impossible to settle because the Department of Justice and the states were not working together. Between them, they appeared to be demanding either a breakup of our company or other extreme concessions that go far beyond the issues raised in the lawsuit." A breakup, or maybe an open source Windows as one of the "other extreme concessions"? Is that the bottom line the government cobbled together, and Bill Gates rejected on Friday night? ® Related stories: MS guilty verdict looms as mediation talks collapse Complete Register Trial coverage

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