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November 09, 1999 - Image 2

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The Michigan Daily, 1999-11-09

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2 - The Michigan Daily - Tuesday, November 9, 1999r'ATIONI X ORLD
Judge puts Microsoft under fire

WASHINGTON (AP) - The judge
behind the ruling against the Microsoft
Corp. didn't question the honesty of
Bill Gates outright, but he rejected
almost every explanation of events
offered under oath by the world's most
famous billionaire.
The lack of faith that U.S. District
Judge Thomas Penfield Jackson
showed in Microsoft's trustworthiness
could hurt chances for a less severe
punishment - or even for a settlement
offer - that relied on a company
pledge of some future behavior toward
rivals in the technology industry.
The judge could order remedies up to
or including a breakup of the company
in the next phase of the case unless a
settlement is agreed to in the meantime.
Time and again, the judge embraced
the government's version of key events
and Microsoft's motivations in last
Friday's antitrust ruling.
..In one of its most sensational claims
during the lawsuit, the Justice
Department said Microsoft quietly met
with software rival Netscape to illegally
divide the market, a charge Gates him-
self called "an outrageous lie"
The judge called the offer "an effort
to persuade Netscape to structure its
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business such that the company would
not distribute platform-level browsing
software for Windows." He didn't buy
Microsoft's version of events through-
out his ruling.
"That's the implication," said
Robert Litan, a former senior Justice
official now at the Brookings
Institution. "He didn't come out and
say it, but if you read between the
lines, that's certainly what he ended
up deciding."
"It's clear he didn't think they had
much (credibility)," agreed Marc
Schildkraut, a former Federal Trade
Commission official who questioned
Gates during negotiations with
Microsoft in the early 1990s in the
FTC's antitrust investigation. "The
findings are very one-sided. It's a tough
row for them to hoe on that ground."
Microsoft declined to comment on
inferences the judge didn't find its wit-
nesses truthful.
But the company's renowned aggres-
siveness - and the implication that
executives bent the truth under oath -
could hurt the chances for negotiating a
settlement or escaping with moderate
conduct-remedy penalties - enforced
promises not to behave in certain ways.
MORE T'A +,1O0

ny opponent with a track record of
defiance ... in the eyes of the law has
to be treated as such.
- Richard Blumenthal
Connecticut attorney general

HMO says doctors will decide treatment
NEW YORK - Abandoning the bedrock principle underlying managed care,
United Health Group says doctors, not health plan administrators, will now have
the final say on which treatments it will cover.
United is the nation's second-largest health insurer, covering 14.5 million peo-
The move accelerates a trend among health maintenance organizations to gi
doctors and patients more freedom. But it raises questions about how HMOs w
control rising costs and whether consumers will be best served by a return to the
"doctor-knows-best" philosophy.
United said its decision makes fiscal sense because it was paying more money
to scrutinize and deny questionable treatments than the practice saved.
United will still ask doctors to justify such decisions as ordering surgery or
expensive diagnostic tests. And the change doesn't mean that United will pay for
services that are currently not covered, such as cosmetic surgery.
But under the new policy, the doctor will have the final say on how the patient
will be treated, the company said yesterday.
United said doctors will be evaluated over the long term instead of case by case,
and those found to be practicing wasteful medicine will be dropped from the hea
care network.

"Any opponent with a track record of
defiance or untrustworthiness in the
eyes of the law has to be treated as
such," said Richard Blumenthal, attor-
ney general for Connecticut, one of 19
states that sued Microsoft with Justice.
"Whenever we talk settlement with
an opponent whose credibility and
trustworthiness are in question, we
would demand very strict and specific
measures of compliance."
"To simply have a court order saying,
'please play nice and don't do these
things' - there are some serious ques-
tions whether conduct remedies would
be enough," added Wayne Klein, Utah's
assistant attorney general. "They're
needed, but will they be enough?"
To assuage the judge, Microsoft also
will need to overcome a courtroom
episode two years ago when it infuriat-

ed Jackson.
When he ordered Microsoft in
December 1997 to separate its Internet
browser software from its dominant
Windows operating system, the compa-
ny complied - except Windows didn't
work anymore. "It seemed absolutely
clear to you that I entered an order that
required you to distribute a product that
would not work?" Jackson asked, out-
raged. "Is that what you're telling me?"
Harry First, the head of antitrust for
the New York attorney general, said
those types of legal maneuvers don't
help the company convince the judge it
can be trusted.
"How do they carry out these obliga-
tions? Do they cut corners?" First asked.
"We've got a bit of a track record.
Certainly this judge has seen it in front of
him. The past is prologue."

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Continued from Page 1
As of Friday, the proposal would
mean a gain to lenders of .41 percent.
The student loan provision has the
potential of driving up the costs for the
federal government and costing tax pay-
ers more, which can result in a cut in stu-
dent loans in the long run, Frishberg said.
But supporters of the provision claim
that they "don't anticipate that this will
have any impact on students or tax pay-
ers," said the committee's Director of
Communications Becky Campoverde.
Further objection to the provision is
the projected $1.75 billion profit in five
years that the student loan industries
will gain without any benefits to the
students, Frishberg said.
The provision "potentially takes
money away that could otherwise be
available to students," said Margaret
Rodriguez, associate director of
Financial Aid at the University.
Officials at Sallie Mae are lobbying
for the transfer to commercial paper
which will "increase the efTiciency and
stability of the" Federal Family
Education Loan Program, Sullivan said.
The government is using the budget
surplus to reduce the national debt,
effecting the supply of treasury bills to
which the student loan industry's
income stream is tied, Sullivan said,
adding that the capital market must be
tapped to raise the $25 billion needed
annually to support student loans.

Opponents to the provision said that
the competition created by the shift to
commercial paper will harm students.
Small lending agencies will not ben-
efit from the provision which would
allow the larger companies to decrease
competition, said Jamie Pueschel, leg-
islative director of the U.S. Students
Association. Less competition is harm-
ful to the students, she added.
Much of the controversy surrounding
the use of commercial paper began with
the 1998 Higher Education Act when
the proposal was first introduced and
then rejected, Pueschel said. She added
that the student loan industry then
attempted to attach the provision to the
Labor Health and Human Services
appropriations bill and when that was
rejected, they attached the provision
into an unrelated bill.
The bill was not passed through the
Education and Workforce Committee,
Rep. Dale Kildee (D-Flint) said. The
provision was "done outside the com-
mittee of jurisdiction," he said and as a
result, hearings were not held on behalf
of the students, Kildee said.
But although the provision was not
passed through the Education and
Workforce Committee, members have
expressed support for passage of such a
provision. There is bi-partisan support
by the full committee and subcommit-
tee, Campoverde said.
Under the act, a study group was
formed in which Frishberg and others
considered the use of commercial
paper, he said, and determined that the
student loan calculations in the pro-
posed provision was inaccurate due to
unrealistic projections.

High court declines
death penalty cases
WASHINGTON - The Supreme
Court refused to consider whether the
execution of prisoners who have spent
nearly two decades on death row is
cruel and unusual punishment yester-
The court rejected appeals from
Florida and Nebraska inmates who
had been on death row for nearly 25
and 20 years, respectively, and
claimed that delayed executions vio-
lates their Eighth Amendment
There was no statement on behalf
of the full court in its denial of the
separate petitions, but Justice
Clarence Thomas penned a concur-
"I write only to point out that I am
unaware of any support in the
American constitutional tradition or
in this court's precedent that a defen-
dant can avail himself of the panoply
of (appeals) and then complain when
his execution is delayed," Thomas

He then detailed what he called the
Supreme Court's "Byzantine death
penalty jurisprudence," which permits
several levels of court hearings intend-
ed to ensure a defendant has not been
unfairly sentenced to die.
Senate to debate
agribusiness mergers
WASHINGTON - With the Clinton
administration's blessing, giant grain
trader Cargill recently acquired the
grain operations of one of its major
competitors, and the merger of two
major manufacturers of farm tractors
was approved.
Now the Justice Department is be@
asked to approve a deal in which the
largest pork processor would take over
its nearest competitor.
It would be the latest in a wave of
mergers and acquisitions reshaping the
U.S. agriculture and food industries.
The Senate is to vote this week on a
proposed 18-month moratorium on
agribusiness mergers.


China gov't arrests
111 Falun Gong

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We've Been There.

BEIJING - In the first official
release of such statistics, the Chinese
government announced yesterday that
police have formally arrested I11 fol-
lowers of the banned Falun Gong spiri-
tual group on criminal charges ranging
from stealing state secrets to engaging
in illegal business activity.
A spokesperson for the State
Council, or Cabinet, said the govern-
ment is employing a range of lesser
punishments on a far larger number of
followers, which helps explain the sig-
nificant discrepancy between the offi-
cial government arrest total and figures
cited by human rights groups and Falun
Gong followers. The Hong Kong-based
Information Center of Human Rights
and Democratic Movement in China
reported Sunday that authorities have
sentenced more than 500 people to
labor camps.
Most Falun Gong practitioners who
have come to Beijing in recent weeks to

protest the official ban on their group
have not been arrested but rather
"picked up, given re-education and sent
back to their hometowns," said Li Bing,
deputy head of the State Council's
information office. He acknowled$
that two sect members died while in
custody, but he denied allegations that
the authorities were responsible.
Pope seeks ties with
Orthodox Church
TBILISI, Georgia - Pope John Paul
II took his drive to "build new bridges"
with the Orthodox Church to this
mer Soviet republic yesterday, but his
initiative appeared to meet resistance.
On a visit that pointed to the diffi-
culty in reaching his goal of closet
links among Christian denominations,
the pope was greeted by Georgian
Orthodox Patriarch Ilia II and President
Eduard Shevardnadze on his arrival
from India.
- Conipiledfrom Daily wire report


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