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4 More States Seek Microsoft Oversight

Four states press federal court to extend by five years oversight of the software company that began in 2002 as part of a landmark antitrust settlement.

Four states concerned about Microsoft Corp.'s market power are pressing a federal court to extend by five years oversight of the software company that began in 2002 as part of a landmark antitrust settlement.

The request, filed late Thursday, represents a reversal for New York, Maryland, Louisiana and Florida. In August, the group submitted court papers, along with the Justice Department, that said the consent decree had achieved its goal of safeguarding competition in certain software markets.

In their newest filing, however, the states said that while "competitive developments in the industry today are encouraging, whether they have enough traction to enhance long-term competition" in the market for computer operating systems "is uncertain."

Jeffrey Lerner, communications director for the New York Attorney General's office, said the success of the decree thus far is the rationale for extending it. "We believe that the court's order has helped marketplace participants compete, and contributed to the product choices that are available to consumers and business using personal computers," Lerner said in an e-mailed statement.

The four states joined a separate group of six states -- led by California -- and the District of Columbia, arguing last month during a court hearing that it would ask for a five year-extension of the settlement, to 2012. The decree is set to expire Nov. 12.

The so-called California group of states submitted its request in writing late Oct. 16.

Microsoft spokesman Jack Evans said there is no need for further oversight of the company's business. "The consent decree has served its purpose," he said.

The antitrust settlement -- reached between Microsoft, the federal government and 17 states -- barred the software giant from certain anticompetitive behaviors, such as seeking deals with computer makers to exclude competing software, and sought to ensure that Microsoft couldn't use its operating system monopoly to stifle competition in other products.

Efforts to extend the decree may face an uphill battle. U.S. District Court Judge Colleen Kollar-Kotelly said during a hearing Sept. 11 that she would consider the California group's request, but added that any extension would need to be for an "identifiable purpose."

Currently, Microsoft is on track to be in compliance with the antitrust settlement when it expires, Kollar-Kotelly said.

Evans said Microsoft intends to file a response to the states' request by the end of October. A status hearing on the antitrust decree is scheduled for Nov. 6.

Shares of Microsoft fell 99 cents, or 3.18 percent, to close at $30.17 Friday.

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