WASHINGTON -- The federal judge in the Microsoft Corp. antitrust case Friday appointed a mediator to spur an out-of-court settlement between the government and the software giant, a surprising and unusual move that could improve the chances of both sides resolving their high-stakes legal battle.
U.S. District Judge Thomas Penfield Jackson named Richard A. Posner, chief judge of the 7th U.S. Circuit Court of Appeals based in Chicago, to oversee "voluntary" talks between the parties. Posner, 60, is regarded as a conservative jurist and one of the founders of the "Chicago School," an influential group of professors and economists skeptical of government regulation of business.Jackson, who ruled two weeks ago that Microsoft has used its monopoly power to stifle competition and harm consumers, has repeatedly urged both sides to settle their dispute before he decides whether the company's actions were illegal. Although the parties have had some preliminary settlement discussions over the past year -- and have publicly stated their desire to reach an agreement -- they have remained far apart on fundamental issues.
Jackson broached the idea of tapping Posner to mediate during a closed-door meeting with government and Microsoft lawyers on Thursday afternoon, according to sources familiar with the conversation. Both sides told Jackson Friday morning that they would welcome Posner, the strongest sign to date that they are willing to search for middle ground.
Despite his conservative credentials, legal specialists believe Posner's appointment will not provide an automatic advantage to Microsoft in the negotiations. "He's a conservative, but he's not a knee-jerk conservative," said Mark Patterson, a law professor at Fordham University. "Although he's not a fan of government enforcement, he has, at times, shown a fair amount of impatience with what are clear antitrust violations."
Jackson's scathing ruling two weeks ago stopped short of concluding whether Microsoft's aggressive business behavior violates the Sherman Antitrust Act. The judge has said he will address that issue in another decision that likely will be released early next year, assuming the parties do not reach a settlement. Given the tenor of the initial "findings of fact," though, legal specialists expect Jackson to rule that the company has broken the law and to slap it with stiff sanctions.
Legal experts predict Posner could help bridge the current chasm between the government and Microsoft by outlining the risks each side would face when appeals court judges like himself review Jackson's final ruling.
"Posner will try to get both sides to back off their extreme views that make a solution infeasible," said William E. Kovacic, a George Washington University law professor. "He'll tell Microsoft they won't necessarily get the appeals court to reverse Judge Jackson, and he'll remind the government that the road beyond Judge Jackson could be a very bumpy one."
Kovacic and other law professors called Jackson's selection of an appeals judge as a mediator in such a high-profile antitrust case "unprecedented."
Posner's appointment was warmly welcomed by both the government and Microsoft.
"We look forward to meeting with him to discuss ways to address the serious competitive problems identified in the court's findings of fact," Justice Department spokeswoman Gina Talamona said. "The department has always been willing to seek a settlement that would promote competition, innovation and consumer choice."
Microsoft spokesman Mark Murray called Jackson's move "a very positive step toward resolving this case without the need for further litigation."
"We're looking forward to working with Judge Posner to try to reach a fair and reasonable solution that's good for consumers and good for the high-tech economy," Murray said.