Today's New York Times [registration required] suggests that a lawyer at the U.S. Department of Justice may have acted as though he was still on Microsoft Corp.'s (NASDAQ: MSFT) legal team. His memo to state attorney generals encouraged them to dismiss a private lawsuit filed by Google, Inc. (NASDAQ: GOOG) which alleges that Microsoft's Vista operating system effectively crippled Google's desktop search program.
The official, Thomas O. Barnett, an assistant attorney general, had until 2004 been Vice Chairman of the antitrust department at Covington & Burling, the law firm that has represented Microsoft in several antitrust disputes including its 1998 antitrust dispute involving Netscape -- now a subsidiary of Time Warner, Inc. (NYSE: TWX).
Google's lawsuit contends that Microsoft's competing desktop search program slows down Google's desktop search tool. Google's suit alleges that this market conduct is in violation of Microsoft's 2002 consent degree that prohibits Microsoft from designing operating systems that limit the choices of consumers.
Richard Blumenthal, Connecticut State Attorney General, likens Google's allegations to what Microsoft did in the 1990s to disable Netscape's Navigator web browser in favor of its Internet Explorer. But Microsoft has smartened up since then -- between 2000 to 2006 it spent $55 million on lobbying activities in Washington and substantially more on lawyers.
But as the political winds shift away from the Bush administration -- and its lax antitrust enforcement -- Barnett's effort to press his thumb on the scales of justice may end up backfiring.
Have you tried to use the Google search bar on Vista? If so, do you think Google's claim is legitimate?
Peter Cohan is president of Peter S. Cohan & Associates, a management consulting and venture capital firm. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned in this post.