TAFOL Files An Amicus Curiae (Friend of the Court) Brief Supporting The Microsoft Corporation

by | Dec 27, 2000

The Microsoft antitrust case represents a breathtaking and frightening extension of antitrust law to a new American technological industry that is the envy of the rest of the world.

By Robert Getman

On December 26, 2000, TAFOL filed an Amicus Curiae (Friend of the Court) Brief supporting Microsoft Corporation in its appeal before the United States Court of Appeals for the District of Columbia Circuit. The appeal involves the antitrust cases brought by the Federal Department of Justice and twenty (20) State Attorneys General.

This brief is the latest in a series of Amicus briefs that TAFOL has written over the years. The others include: briefs in the recent Elian Gonzalez case before both the trial court and the Eleventh Circuit Court of Appeals; briefs in the IOLTA case, challenging compulsory contributions to “public interest” lawyering via confiscation of interest earned on forced deposits of client funds by lawyers before the Fifth Circuit and the United States Supreme Courts; and briefs opposing mandatory “volunteerism” as a prerequisite for high school graduation in the Second and Fourth Circuits.

The Microsoft antitrust case represents a breathtaking and frightening extension of antitrust law to a new American technological industry that is the envy of the rest of the world.1 TAFOL’s brief showed that the antitrust “laws” are not valid laws, but non-objective edicts that amount to arbitrary lawlessness, and that these “laws” violate a number of guarantees of our Constitution. Using words directly from the mouth of the Supreme Court, the brief revealed the evolution of antitrust dogma as a series of obfuscations, rationalizations and contradictions, in which the high court “set sail on a sea of doubt” (as one judge aptly put it).2 This “sail”, in case after case, necessarily led to further subjectivity, because the court refused to abandon the false lodestars of antitrust. The courts and hapless defendants found that there are no signposts in the fog of the arbitrary.

The brief traced the history of this last point in some detail. The basic antitrust statute3 makes illegal “Every contract, combination in the form of a trust or otherwise, or conspiracy in restraint of trade.” As early as 1911, the Supreme Court noted that, as a result of “the absence of any definition of restraint of trade as used in the statute,” the statute made every contract illegal.4 “[F]inding the scope of the statute thus construed unworkable, the Supreme Court literally inserted judicially the term ‘unreasonable’ into the phrase ‘restraint of trade.’ But how is a businessman to know, at the time of making a contract, what provisions will later be considered to fall afoul of the undefined term “restraint of trade”, let alone also be “unreasonable” restraints? Eventually, the courts realized this and, in an attempt to provide some certainty, they introduced so-called “per se” rules, rules which define certain descriptive categories of conduct (e.g., “boycott” or “price-fixing”) that are declared to be unreasonable. Of course, these pigeonholes are not found in the statute, immediately raising the question of the legitimacy of such “judicial legislation.”

In sum, TAFOL’s brief took an “Abolitionist”5 position; it showed that this was the truly “American” position as well as an Objectivist position. The brief liberally cited and quoted our Founding Fathers side by side with Ayn Rand. The introduction to the brief summarized that:

Amicus’ philosophy holds that proper government is the limited government
established by our Founders, in which sovereign citizens retain a reservoir of
rights, as our 9th Amendment held, while the government is strictly limited—
subordinating might to rights. It holds that the sole function of government
is to protect individual rights and that government properly does so using
only objective laws, laws which ‘[i]n regard to derivation [are] tied to reality
by man’s only means of knowing reality: reason [and] [i]n regard to form have a
firm, stable knowable identity6 so that they may tell men the law and the nature
and cause of the accusations (to use the 6th Amendment’s words) they will
face if they disobey. If, as is proper, ignorance of the law is no excuse,
government must make only laws which are comprehensible to citizens, or
it is not a civilized government of laws and not of men.

In stark contrast, antitrust is based on the opposite premises: self-sacrificial
altruism, collectivism and non-objective law. It is modeled upon sacrifice in that
it demands that some men (such as producers) must sacrifice themselves for
the sake of others (such as ‘consumers’). It is collectivist in its view that
individual rights may be overridden by the supposed interests of a collective
(such as ‘consumers’ or ‘society’ or their overall ‘economic efficiency’).
Further, antitrust ‘laws’ are actually lawless, paradigms of non-objective
law that not only deprive man of his right to life and property but do so by
ncomprehensible statutes whose ambiguities are multiplied by mountains of
case-by-case precedent which no man even with an army of lawyers, can
comprehend before he acts, rather than ex post facto. Worse, in an alleged
‘monopolization’ case such as this, they punish with draconian severity so-called
monopolists who are deemed, under vague and shifting standards, to be
‘too successful’ in free trade, depriving them of Equal Protection of the Laws.
And ‘in this divestiture case, which spawned numberless punitive triple
damages cases, these ‘laws’ are the corporate equivalent of a ‘cruel and
unusual’ capital punishment by being drawn-and-quartered plus by a death
by a thousand cuts of ‘excessive fines’, in the words of the 8th Amendment.

Notably, TAFOL also briefed an important issue specific to—and notorious in—the Microsoft case: that Microsoft was “railroaded” by the government’s litigation conduct, and by the trial judge in his conduct of the case and extraordinary out-of-court interviews and statements even while the case was in progress. These statements included private discussions with reporters and public comments about the reasons for his decision, going so far as comparing Microsoft to a street gang. As TAFOL’s brief wrote: “Worse still, the judge admitted that Microsoft’s ‘intransigence’ in [refusing to settle the case on the government’s terms] was a key factor in imposing the harsh penalty. This created a perilous new antitrust principle: the more a presumptively innocent defendant insists on his innocence and stands by his belief, the more terrible will be his punishment.”

Subsequent developments provide striking and rewarding confirmation that TAFOL chose this issue wisely. First, Microsoft itself chose to feature this issue in its brief, even though criticism of a trial Judge who may later re-hear the case is risky. What’s more, the appeals court went

Microsoft one better, in a sense: even though Microsoft did not take the further step of requesting that oral argument devote any time to this issue, the court on its own ordered that 30 minutes of argument be especially devoted to the issue. This is twice as much time as it allocated to the question of whether Microsoft had attempted monopolization—and almost as much time as it allocated to argument concerning the extraordinary corporate “breakup” remedy imposed by the trial Judge.

TAFOL’s brief concluded by invoking the terms of the most basic constitutional rights and the explanation of their base by Ayn Rand:

Article 2d of the New Hampshire Constitution declared that” All men have
certain natural, essential, and inherent rights —among which are the
enjoying and defending life and liberty; acquiring, possessing, and
protecting property; and in a word, of seeking and obtaining happiness.”
Ayn Rand explained the underlying philosophy:

“[M]an has to work and produce in order to support his life. He has to support
his life by his own effort and by the guidance of his own mind. If he cannot
dispose of the product of his effort, he cannot dispose of his effort; if he
cannot dispose of his effort, he cannot dispose of his life. Without property
rights, no other rights can be practiced . . .The right to life is the source of all
rights—and the right to property is their only implementation. Without
property rights, no other rights are possible. Since man has to sustain his
life by his own effort, the man who has no right to the product of his effort
has no means to sustain his life. The man who produces while others dispose
of his product, is a slave.”
. . .
Is man a sovereign individual who owns his own person, his mind, his life, his
work and its products—or is he the property of the tribe (the state, the society,
the collective) that may dispose of him in any way it pleases, that may dictate
his convictions, prescribe the course of his life, control his work and expropriate
its products? Does man have the right to exist for his own sake—or is he born
in bondage, as an indentured servant who must keep buying his life by serving
the tribe but can never acquire it free and clear?”

  1. Rand, “What is Capitalism?” in Capitalism: The Unknown Ideal supra at 10-11.
    Americans have known the answer since our Declaration of Independence, and
    since slaves were freed. These are the principles to which America should return.
    In the face of these vital rights, and the fundamental constitutional infirmities
    of the antitrust regime, this Court should not sanction the destruction of the
    world’s most successful company (in market capitalization) under the false
    banner of that paradigm of nonobjective law, that judicial and political
    rationalization, that arbitrary anti-rights, anti-ability and anti-success regime
    bearing the misnomer antitrust “law.” We respectfully urge reversal.”

At oral argument, almost all of the appeals court judges were concerned about the conduct of the trial judge. While predicting the outcome of an appeal is an uncertain affair, this is a good sign. It seems likely that any further proceedings in the case will be sent to a different judge, a transfer which may have its greatest impact on the “remedy” because it was that phase of the trial which was short-circuited the most by the trial judge.

You—past, present and, hopefully, future monetary contributors to TAFOL—each are soldiers in this fight. With your continued help, we may see that reversal, a significant step in the halt of the antitrust juggernaut. Help us to help more. Send a contribution today.

Note and References:

  1. There is speculation that the Bush administration will settle the case on terms acceptable to Microsoft. However, even if such speculation is well-founded, any conceivable “settlement” would almost certainly be a dangerous attempt to accommodate individual rights to the legal terrorism of antitrust, for any agreement to so-called “consent” decrees in antitrust are hard to justify. Furthermore, such a settlement still would leave alive the equally threatening companion case brought by the state Attorneys General, who are very unlikely to agree to any settlement palatable to Microsoft unless the current appeal is resolved greatly in Microsoft’s favor. (In response to the repeated specter of states prosecuting such cases under their own state antitrust acts, TAFOL—and TAFOL alone—briefed the point that allowing each state to have an antitrust statute is unconstitutional.) Hence the battle in the appeals court, which TAFOL is helping to fight, might be more important to the cause of fighting antitrust than Bush’s electoral victory.
  2. The phrase, “sea of doubt”, was coined by Judge William Howard Taft in United States v. Addyston Pipe & Steel Co., 85 F. 27 1, 284 (6th Cir.1898), aff’d 175 U.S. 211 (1899). Judge Taft later became president of the United States and chief justice of the Supreme Court. He is the only person to serve in both capacities.
  3. § I of the Sherman Antitrust Act
  4. Standard Oil Co. of N. J. v. United States, 221 U.S.1, 63 (1911); United States v. American Tobacco Co., 221 U.S. 106, 179 (1911)
  5. “The repeal of the antitrust laws should be our ultimate goal. . .” Ayn Rand, “Antitrust: The Rule of Unreason,” reprinted in The Voice of Reason, Essays in Objectivist Thought 254, 259.
    The apt analogy to the abolitionists comes from Richard Salsman’s lecture at a recent Second Renaissance Conference.
  6. H. Binswanger, “What is Objective Law,” The Intellectual Activist, v. 6 #1 (1/92) at 9
    [see also at TAFOL Bulletin #7 on this web site.]

 

 

 

Copyright © The Association for Objective Law. All rights reserved. Republished in Capitalism Magazine by permission of TAFOL.

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