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Wednesday, June 24, 1998 Published at 09:11 GMT 10:11 UK


Business: The Company File

Microsoft victory

Microsoft has won the battle but not the war

Microsoft has won an important victory in its court battle with the US Justice Department.

A US appeals court has lifted a preliminary injunction against Microsoft that had prevented the company from marketing its Explorer Internet browser along with its Windows 95 operating system.

The news helped Microsoft's shares jump more than 4% on the Nasdaq index. They were up $3.81 to $99.625 and near the high reached before the US authorities launched their latest court case against the world's biggest computer software group and one of America's most powerful companies.


[ image: Microsoft stands accused of trying to forge a monopoly]
Microsoft stands accused of trying to forge a monopoly
Microsoft had appealed against a ruling issued last December by Federal Court Judge Thomas Jackson who was acting on a complaint from the US Justice Department.

Judge Jackson had said that the company's practices required further examination and in the meantime slapped an injunction on Microsoft preventing it from requiring computer makers to install its Internet browser.

The Justice Department argued that such a practice violated a 1995 court order.

But Microsoft's argument that Judge Jackson exceeded his authority by imposing the injunction has been upheld.


[ image: Windows 98 will be launched into yet more legal wranglings]
Windows 98 will be launched into yet more legal wranglings
The federal appeals court found that the preliminary injunction was issued without adequate notice and had been based on "an erroneous reading" of a 1995 agreement between the Justice Department and Microsoft.

Microsoft's chief operating officer, Bob Herbold, said: "This decision is good news for consumers and the entire computer industry."

The Justice Department said it was disappointed by the decision. "We're reviewing the opinion to assess our options," it said in a statement.

However, the decision does not mark the end of the tussle between Microsoft and the Justice Department. It faces an impending court battle over its Windows 98 operating system which launched around the world on Thursday. Microsoft has installed an Internet browser as part of its new package.

The US Justice Department's landmark legal case against Microsoft is due to start on September 8.

Joel Klein, the main prosecutor in the Microsoft case, has said he is challenging the way Microsoft wants to use its operating system to stifle competition in new markets, especially the Internet market. He is determined to take action against Microsoft as soon as possible.

Microsoft has continued to ship its new operating system despite the impending law suits.

Windows is currently used in nine out of every ten personal computers.



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