Microsoft loses EU appeal
The antitrust order against the software giant included a record $613 million fine.
BRUSSELS, Belgium - In a stinging defeat for the world's biggest software-maker, Microsoft Corp. lost its appeal of a European antitrust order yesterday.
The order, issued by regulators in 2004, requires the company to pay a record $613 million fine, share communications code with rivals, and sell a copy of its Windows operating system without Media Player.
Yesterday's decision also affirms Europe's role as the lead international regulator of companies that are dominant in their industries.
In the last two months, EU regulators have charged Intel Corp. and Rambus Inc. with antitrust abuse. This week, it will hold closed hearings in which Apple Inc. will defend itself against allegations that it restricts customer choice with separate national iTunes stores.
In yesterday's decision, the EU Court of First Instance ruled against Microsoft on both major parts of the case, saying the European Commission was correct in concluding that the company was guilty of monopoly abuse in trying to use its power over desktop computers to muscle into server software.
Microsoft, of Redmond, Wash., said it would withhold comment on the decision and on whether it would appeal to the EU's highest court, the European Court of Justice, until it had gone through the 248-page ruling. It has two months to appeal.
But Microsoft lawyer Brad Smith said the company accepted that it might need to do more to comply with EU demands, though he offered no details.
"It's not our desire and it is not our goal to have continuous arguments and disputes. We want to move forward," he told reporters - saying he had called the European Commission earlier to congratulate it.
While the fine was the largest ever assessed by EU regulators, Microsoft has plenty of resources: It posted a profit of $14.07 billion last fiscal year.
Its shares fell 31 cents to settle at $28.73 in Nasdaq trading yesterday.
The court said European Commission regulators had clearly demonstrated that selling media software with the Windows operating system, which manages a personal computer's functions, had damaged rivals.
But the court overturned regulators' decision to appoint a monitoring trustee to watch how Microsoft had complied with the ruling, saying the European Commission had exceeded its powers by ordering Microsoft to pay for all the costs of the trustee.