It remains to be seen what impact the appeals court’s decision will have on the broad new antitrust case that the Justice Department has filed against Microsoft. A key allegation in that case is that Microsoft is illegally ‘bundling’ Internet Explorer with its new Windows 98 platform. Following the appellate court ruling, the Department issued a statement saying that it remains 'confident that the evidence... will demonstrate that Microsoft's conduct has violated federal antitrust law'. However, a former senior Department official was quoted as saying that the appellate court decision 'cuts the legs out from under the... Department on their new case. It is potentially devastating.' The government’s case, which will be heard by the same judge whose injunction the appeals court overturned, is scheduled to go to trial in early September.

Ronan P Harty
Davis Polk & Wardwell
New York City