EU Court rejects Microsoft’s antitrust verdict appeal

Microsoft Corporation has lost an appeal against a ruling by the European Union (EU) that the company abused its dominant market position in order to force out rival firms.

The European Union Court of First Instance on September 17, 2007, threw out the appeal by Microsoft, which had challenged the EU ruling that the company had acted illegally by using its ubiquitous Windows operating system in an effort to keep rivals out of the software market.

The ruling was made by the 13-judge Grand Chamber of the Court of First Instance in Luxembourg, the first time such a matter has been broadcast on live television.

The European Union Court also rejected Microsoft’s appeal against the euros 497-million ($689.9 million) fine imposed on the company.

The EU had later fined Microsoft an additional euros 280.5 million, saying that the company had failed to comply with its decision on interoperability. The EU regulator is considering a further fine for non-compliance.

The case relates to Microsoft’s policy of including its own Media Player software as part of the Windows package and refusing to provide the technical information that rivals would need to offer their product.

The European Union’s second-highest court dismissed Microsoft’s appeal on all substantive points, but allowed the company a small concession by reversing the EU order on the creation and funding of a monitoring trustee to ensure implementation of one of the remedies.

A statement from the European Union Court said: “The Court of First Instance essentially upholds the European Union’s finding that Microsoft abused its dominant position.”

The European Union welcomed the long-awaited ruling in the 9-year-old case. EU officials had said that said a defeat would have diminished its ability to regulate hi-tech industries.

The verdict, which can be appealed to the European Court of Justice only on points of law and not of fact, opens the way for Competition Commissioner Neelie Kroes to take additional action against Microsoft.

The EU executive, which has wide-ranging anti-trust and merger control powers, found in 2004 that Microsoft had used its 95% share of the market in personal computer operating systems to push aside and damage smaller rivals.

A spokesman for the opponents, the European Committee for Interoperable Systems, said the European Union Court ruling confirmed that Microsoft had abused its near-monopoly in computer operating systems and set ground rules for the company’s behaviour.