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Microsoft breakup reversed on appeal: Federal driving and dialing legislation pending

SEATTLE-Finally, the breakup talk may fizzle out for Microsoft Corp.

Thanks to a unanimous decision by the federal appeals court, the software giant may not worry about antitrust accusations as the court said the lower court, whose decision it was reversing, “engaged in impermissible ex parte contacts by holding secret interviews with members of the media and made numerous offensive comments about Microsoft officials in public statements outside of the courtroom.”

It rejected the government argument that Microsoft acted illegally by bundling the Internet Explorer browser with its Windows offering, adding that the company would have to prove that competition suffered as a result.

Although Attorney General John Ashcroft called the decision a victory, the Justice Department said: “We are pleased that the Court of Appeals found that Microsoft had engaged in illegal conduct to maintain its operating-system monopoly. We are reviewing the court’s opinion and considering our options.”

Microsoft was clearly delighted, too, hoping that the matter will be laid to rest.

“Microsoft, as we have been throughout the case, is very open to the idea of settlement. We don’t think extensive litigation and the resources that involves are really good for anyone,” said Bill Gates, chairman of Microsoft.

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