After partial settlement, Microsoft faces two-front court fight

WASHINGTON (AP) -- Failing to settle its antitrust case with all sides, Microsoft Corp. is now in the precarious position of complying with already negotiated sanctions while risking additional future penalties the trial judge could impose as early as next year.

Some legal experts wonder whether Microsoft Chairman Bill Gates jumped this week from a frying pan of secret negotiations into a potential fire in federal court. Instead of a unified battle against the Justice Department and 18 states, Microsoft's lawyers must now wage fights simultaneously on disparate fronts: convincing the judge in one set of hearings that its concessions are tough enough even as some states press in other hearings for much harsher sanctions.

Nine states, including New York and Wisconsin, announced a settlement Tuesday with Microsoft and the Justice Department after the company agreed to new provisions aimed at ensuring that competitors can build software products that work seamlessly with the monopoly Windows operating system.

As many as nine other states said they will press forward in the antitrust case and begin collecting evidence soon to decide the most appropriate penalties for Microsoft. A federal judge already has determined the software maker is guilty of illegally using its influence in the technology industry to undermine rivals.

Officials in some of those nine states hinted they may eventually settle their complaints, perhaps within the week. "A number of states said they will take a look at this over the next few days," said Iowa's attorney general, Tom Miller, who was responsible for preserving the states' coalition. Miller, one of Microsoft's most consistent critics, said even he could not rule out a settlement.