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Tim O'Brien: Explaining the Microsoft ruling

O'Brien

Microsoft was handed a defeat Friday by the U.S. Circuit Court of Appeals in the District of Columbia, which rejected the software giant's request to delay any further court action until the U.S. Supreme Court rules on its antitrust case.

CNNfn correspondent Tim O'Brien explains the decision.

CNN: What happened in today's ruling?

O'BRIEN: You'll recall [that] last June a federal appeals court found Microsoft guilty of antitrust violations and ordered the case back to a lower court to determine what the remedy should be.

Microsoft is appealing that decision right now to the U.S. Supreme Court and it has asked the appeals court for a stay, to put its previous decision on hold until the U.S. Supreme Court decides if it wants to get into this fray.

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Well, today the appeals court declined to do that. This is not really a ruling on the merits at all; it merely allows the case to go back to a lower court while the Supreme Court decides whether to get involved.

In order to get a stay from an appeals court ruling, Microsoft had to show one, that it had a reasonable chance of winning in the Supreme Court and two, that it would suffer irreparable harm if the stay were not granted.

The court of appeals today did not address that first part, but it did say on the second point "Microsoft has failed to demonstrate any substantial harm that would result from reactivation of the proceedings in the district court."

Microsoft can now ask the Supreme Court itself for a stay. If no stay is forthcoming then a new district judge will start considering remedies while the Supreme Court decides if it will get involved in this case.

CNN: Any idea of how soon that will get through the Supreme Court process? And what is the net effect of the ruling on consumers?

O'BRIEN: No immediate effect on consumers based on what happened today, but everybody is watching the clock, the timetable. The Justice Department has until September 6 to respond to Microsoft's bid for Supreme Court review and we could hear at the very earliest from the Supreme Court in the last week of September.

CNN: We know Microsoft is about to roll out some big products this fall, could this put a wrinkle in those plans?

O'BRIEN: Well, it's possible. It all depends on what the Supreme Court does. If the Supreme Court grants a stay, then it will have no impact at all on the new XP program. Even if the Supreme court doesn't grant a stay, there's a real possibility that Microsoft could work out a deal with the justice department to allow XP to go forward.