Microsoft Files Opposition to Bristol's Motion for Preliminary Injunction

(September 30, 1998)  Microsoft filed its opposition to Bristol Technology's motion for a preliminary injunction in federal court in Connecticut on Friday, September 25.  Microsoft released a redacted public version of its brief on Monday.   Microsoft denies that it has violated any antitrust law, and argues that Bristol is simply trying to gain an advantage in ongoing contract negotiations regarding access to Windows NT 4.0 and 5.0 source code.

Bristol Technology Inc. filed its original Complaint against Microsoft on August 18 alleging that Microsoft refused to grant it a license which includes access to Windows NT 4.0 and 5.0 source code, and that this constitutes a violation of federal and state antitrust law.  Plaintiff alleges the Microsoft has monopolies, not only in the desktop PC operating system market, but also in the network server and technical workstation operating system markets.   It accuses Microsoft of monopoly leveraging, refusing to deal, and denial of an essential facility, among other things.  Bristol also filed a motion for preliminary injunction, asking the court to order immediate access to Windows NT 4.0 and 5.0 source code.

Microsoft alleges in its opposition that there is no antitrust law violation.  Microsoft further argues that this suit is really contract negotiations by other means.  That is, Microsoft owns Windows NT, and is willing to license access to source code to Bristol, but Bristol has rejected its terms.  Microsoft contends that Bristol is trying to use claims of antitrust law violation to obtain a court order that essentially writes a license contract that Bristol could not obtain through arms length negotiations, and which would give it a competitive advantage over Bristol's rival, Mainsoft.

"The antitrust claims asserted by Bristol are nothing more than transparent "cover" for Bristol's request that this Court intervene in what were ongoing contract negotiations and write and award Bristol a contract on terms it could never obtain at the bargaining table.  Indeed, by this action Bristol seeks to obtain a much better deal than what its chief competitor, Mainsoft Corporation ("Mainsoft"), agreed to in recent negotiations with Microsoft, and thus to obtain a significant competitive advantage over Mainsoft."  (Brief, at page 1.)

Bristol, like Mainsoft, develops software products that enable applications developed for Windows to run on UNIX.

Microsoft argues that Bristol's antitrust claims are meritless because there is no harm to competition.  "Bristol cannot show any harm to competition -- which is required for each of its federal and state antitrust claims -- because Mainsoft (Bristol's primary competitor) and others provide the same service to the market that Bristol provides. ... Bristol's presence is not even remotely essential for sellers of UNIX operating systems to compete with Microsoft."  (Brief, at page 4.)

Microsoft also argues that Bristol lacks standing to bring an antitrust action because it is not a competitor of Microsoft in the various operating system markets in which it alleges Microsoft holds monopolies; Bristol does not produce operating system software.   (Brief, starting at page 23.)

Microsoft's brief also addresses each of Bristol's claims for relief.  Microsoft argues that it has not refused to deal in connection with its alleged monopolies in network server or technical workstation operating systems.  First, the brief argues that Microsoft has no monopolies in these markets.  Secondly, it asserts that is has not refused to deal; it merely has not offered to provide Bristol the terms that it wants.   (Brief, starting at page 25, and at page 31.)

Microsoft also argues that it has not engaged in any monopoly leveraging. First, it advances the legal argument that this doctrine is not recognized in the Second Circuit.   Second, it argues that Bristol has not alleged any facts that would constitute leveraging.  (Brief, starting at page 29.)

Microsoft further argues that it is not an "essential facility."  (Brief, starting at page 34.)

Microsoft's brief also addresses the requirements for issuance of a preliminary injunction, and argues that they are absent in this case.  It argues that Bristol cannot show that any irreparable injury would occur by denial of the motion.  Any harm could be remedied at trial  And of course, Microsoft argues that Bristol is not likely to prevail on the merits.  (Brief, at pages 14-20.)

Microsoft's brief is 48 pages long, not including the Table of Contents and Table of Authorities.  There are many redactions in the publicly released version.

Microsoft's legal team in this case is headed by the New York law firm of Sullivan & Cromwell, which is also representing Microsoft in its various trial and appellate cases with the U.S. Department of Justice.  David Tulchin is lead counsel.  He is assisted by Michael Tomaino, Marc De Leeuw, and Elizabeth Martin.  Local counsel is the firm of Day Berry & Howard, in Stamford, Connecticut.  In house counsel is Steven Aeschbacher of Microsoft.