The New York Times
November 2, 1998


Antitrust Case Is Highlighting Role of E-Mail

U.S. and Microsoft Test Messages and Memories


The outcome of the Microsoft antitrust case may be a long way off, but one thing is already clear: This is the first major e-mail trial.

The government's prosecution and Microsoft Corp.'s defense, to a striking degree, are legal campaigns waged with electronic messages. The human testimony often pales next to the e-mail evidence. On the stand or in videotaped testimony, the people being questioned shrug, mumble and forget. The e-mail is alive with ideas and competitive zeal, punctuated with profanity and exclamation points.

The second week of the trial ended with the prosecutors being frustrated because a lengthy cross-examination by Microsoft's lead lawyer left no time for the government to show several hours of a videotaped deposition of Bill Gates, the Microsoft chairman. With a new witness, an executive of Apple Computer Inc., taking the stand Monday, it is uncertain when the Gates tape will be played.

The Justice Department and the 20 states suing Microsoft believe that the tape will strengthen their case because it shows Gates saying he was not involved in plans to take what the government alleges were illegal steps to stifle competition in the Internet software market. The Gates videotape, said David Boies, the Justice Department's trial lawyer, offers an "opportunity to judge Gates' credibility."

But the Gates credibility gap, if there is one, becomes an issue not because of the videotape but because his taped remarks can be compared and contrasted with the e-mail he wrote and received. The e-mail record, the government insists, shows Gates waist-deep in plotting the anti-competitive deals and bullying tactics that he denies or professes to have never heard of in his taped deposition.

If his machinations are central to the government's case, why not summon Gates to the trial? "The government does not need to put Gates on the stand, because we have his e-mail and memoranda," Stephen Houck, a lawyer for the states, told the court.

The Microsoft legal team has for months been preparing its e-mail defense. First, Microsoft argues, anything that looks damaging is taken out of context. "I urge your honor," John Warden, Microsoft's lead lawyer, told Judge Thomas Penfield Jackson, "to view with considerable skepticism the crazy quilt of e-mail fragments that seem to form the core of the government's case."

But Microsoft has also mounted an e-mail counterattack, culled from the millions of messages it obtained by subpoena from competitors in pretrial discovery.

Warden's cross-examination ritual is to present a government witness with an internal e-mail from his company and then pose a declaration as a question. These interrogations have two refrains: Isn't it true your company does exactly what you are accusing Microsoft of doing, and isn't it true that Microsoft prevailed not because it is a predatory monopolist but because of its superior technology?

Microsoft is accused of trying to prod companies to stay out of its way. So last week, for example, Warden produced e-mail from Stephen Case, the chairman of America Online, suggesting a partnership with Netscape Communications Corp. in which both companies would focus on their respective strengths.

That division of labor, Case wrote, would be the best way to achieve the goal that Marc Andreessen, Netscape's cofounder, described in an earlier e-mail as beating "the Beast From Redmond that wants to see us both dead" -- a reference to Microsoft's headquarters in Redmond, Wash.

Printouts of e-mail are just another form of written communication. By the 1920s, as typewriters became common, typed memoranda started to be used in court cases. From the 1950s through the 1980s, legal experts say, there was an explosion of documentation fueled by the new technologies of electric typewriters, photocopying and fax machines, and then personal computers.

And e-mail, they add, has played an important role in legal inquiries for years, like the Iran-contra case in the 1980s when e-mail found in Oliver North's computer proved crucial.

But the Microsoft case is the result of a sweeping government antitrust investigation of a high-technology company where e-mail has supplanted the telephone as the most common instrument of communication. "E-mail has just revolutionized investigations of this kind," one senior Justice Department official said.

While under investigation, Microsoft has handed over to the government an estimated 30 million documents, mostly e-mail. In the trial, the two sides have submitted about 3,000 exhibits, mainly e-mail.

And in their e-mail, people often communicate more frankly and informally than when writing a letter or a report -- tap it out, punch a button and it's gone into cyberspace. But e-mail communication is documentary evidence, which in legal cases provides a rich, contemporaneous record of what people were thinking and planning at the time.

It can be a sharp contrast to formal oral testimony, so often coached by lawyers and crafted by selective memory. "The e-mail record certainly makes the I-don't-recall line of response harder to sustain," said Robert Litan, a former senior official in the Justice Department's antitrust division who is now at the Brookings Institution.

It can also be powerful ammunition for pointing to contradictions in testimony. And that is what the government will do in attacking Gates' credibility with his videotaped deposition, taken over three days in August.

The government offered a glimpse of that strategy on the first day of the trial. It showed a few brief clips of a point in the deposition when Gates was asked about a meeting on June 21, 1995, at which, the government alleges, Microsoft offered to divide the browser market with Netscape and to make an investment in the company, which is its chief rival in that market.

In the taped deposition, Gates says he recalled being asked by one of his subordinates whether he thought it made sense to invest in Netscape. He said that he was asked about it after the June 1995 meeting and replied, "I didn't see that as something that made sense."

But in an e-mail on May 31, 1995, Gates urged an alliance with Netscape. "We could even pay them money as part of the deal," he wrote, "buying a piece of them or something."

The contradiction between Gates' deposition and his e-mail, though, does not of itself speak to the issue of whether Microsoft made an illegal offer to Netscape.

To be sure, it is what Microsoft did -- not what it said in e-mail communications -- that counts most. "But once the e-mail that looks bad gets in the record, you end up doing what Microsoft's lawyers are going to spend much of this trial doing -- trying to explain it away," said Stephen Axinn, a leading antitrust litigator with the firm Axinn, Veltrop & Harkrider in New York.