Violating The Sherman Anti Trust Act

As shown in Document A, reformers sought to break up large companies that controlled their area of competition, such as the Standard Oil monopoly on oil fields. However, the way at which they were picked was to organize them into good or bad trusts. The way this was done was at the control of the government, thus creating no set standards as to what company trusts to break up to create competition and which ones to keep. Despite the indecision, this was somewhat successful. As the Clayton Antitrust Act states (Document E), “... it shall be unlawful for any person engaged in commerce, in the course of such commerce, either directly or indirectly to discriminate in price between different purchasers of commodities which commodities are sold for use, consumption, or resale in the United States…”, meaning that women, and other minorities could buy the same items for the same price of others at any store in

There are different types of businesses, for example, some use monopolies, trust and pools, while other eliminate competition for higher prices. As stated in “Progressive reformers regarded regulation as a cure for all sorts of socioeconomic and political problems” , “The Sherman Act of 1890 attempted to outlaw the restriction of competition by large companies that co-operated with rivals to fix outputs, prices, and market shares, initially through pools and later through trusts” , meaning, competition is the

Netscape and Sun Microsystems pressured the Department of Justice for action. Other competitor's felt Microsoft used "predatory and anti-competitive conduct" to impede other platform threats, thereby further entrenching its operating system monopoly. The Department of Justice continued its investigations and actively pursued investigations into the alleged monopolistic activities of Microsoft. During the course of the investigation, Microsoft and the Department of Justice continued to negotiate a new consent decree. After eighteen unsuccessful drafts, the Department of Justice, in conjunction with twenty state

The government, for example, contends that some of Microsoft's business agreements with Internet service providers and Internet content providers, which restrict their ability to promote non-Microsoft browsers, violate Section 1 of the Sherman Act. The government also alleges that Microsoft has violated Section 2 by engaging in anti-competitive actions to preserve its Windows monopoly and to extend that monopoly into the browser market (2).

This trust was an alternative form for a monopoly, and other companies began to use this “trust” form of business in order to create giant monopolies in their independent markets.

Antitrust law in the United States is a collection of federal and state government laws regulating the conduct and organization of business corporations with the intent to promote fair competition in an open-market economy for the benefit of the public. Congress passed the first antitrust statute, the Sherman Antitrust Act, in 1890 in response to the public outrage toward big business. In 1914, Congress passed two additional antitrust laws: the Federal Trade Commission Act and the Clayton Act. (The Antitrust Laws. Web.)

The Sherman Antitrust Act was enacted on July 2nd, 1890 which prohibits activities that restrict interstate commerce and competition in the marketplace.

DOJ was not persuaded by Microsoft's argument that physical machines can more easily be counted than intangible copies of computer software. Nor was DOJ convinced that customers might actually favor long-term contracts to guard against unpredictable price increases and other uncertainties. This raised the question; did Microsoft exploit its dominant market position by "insisting" on "unfair" licensing arrangements? Of course not. Consider that Windows became the industry standard because PC-makers thought it was a "superior" product. An assessment that surely took into account the entire set of product features, not only technical features but also ease of use, quality, price, service, and contract terms. Just like any other product in the competitive market. Consider that there were no barriers that would prevent another competitor from driving Windows out as being the market leader. These are simple conditions that exist in an economic market. Those considerations, apparently, did not impress the DOJ's Antitrust Division.

Commencing in 1990, Microsoft was investigated and then charged with violation of the Sherman Antitrust Act which governs United States businesses. The company was determined to be a monopoly, and one which used anti-competitive practices to keep its leading edge on the market. As would most any organization on the receiving end of the allegations, Microsoft did not agree with the charges and sought to defend its business

The case against Microsoft was brought buy the U.S. Department of Justice, as well as several state Attorneys General. Microsoft is accused of using and maintaining monopoly power to gain an unfair advantage in the market. The case has been under observation for a long time, but the Justice department is having trouble coming up with substantial evidence against Microsoft. Specifically, the Department must prove:That Microsoft has monopoly power and is using it to gain unfair leverage in the market.And that Microsoft has maintained this monopoly power through "exclusionary" or "predatory" acts(Rule).Some say that Microsoft is only taking advantage of its position in the market and using innovative marketing strategies

Microsoft is one of America's top computer companies but, in 1999, it was accused of violating the law through the methods it used to promote its internet browser, "Internet Explorer." The case against Microsoft was brought about by the government and claimed that Microsoft was in violation of the Sherman Act, a law designed to fight monopolies. When that case was finally decided, and it was found that Microsoft had indeed broken U.S. law, a competitor, AOL Time Warner, then filed a civil suit claiming damages from the illegal activities of Microsoft. As a result of the civil suit, Microsoft agreed to pay AOL Time Warner $750 million, as well as allow AOL to use Internet Explorer free of charge for seven years.

In 1998, the U.S. Department of Justice filed suit against Microsoft, claiming that the software company was violating the Sherman Antitrust Act and the terms of a previous settlement by bundling its Internet Explorer browser application with its Windows operating system. The Sherman Anti-Trust Act was passed in 1890 in an effort to prevent monopolies that would threaten competition in the marketplace and would eventually lead to extortionary prices for consumers. The Act restricts companies from any practices that artificially create a monopoly by barring competitors from entering the market.

The hostile takeover of PeopleSoft by Oracle was the results of a lengthy court battle that raised many issues. One issue in particular concerned anti-trust laws and their application to technology companies. The Department of Justice, in an attempt to block the takeover, argued that a merger of this nature would lessen competition and ultimately limit customer choice. An appellant court judge ruled that this case did not meet the criterion of an anti-trust breach and ruled in favor of Oracle. Never the less, many other factors

Later, US Justice Department filed antitrust charges in 1998 against the software company, claiming that Microsoft had taken over the internet browser competition and limited consumer choice. In view of antitrust regulation in the US and EU, and increasing competition in the desktop software market, Microsoft was determined to move beyond the PC software industry. By formally recognizing the emerging business opportunities introduced by the new internet era (“Web 2.0”), Microsoft began to reinvent itself. It wanted to extend its software products into web-based services for businesses and consumers. It wanted to try new sectors such as media, television set top boxes, game consoles and other broader technology services. Microsoft aimed to transform itself and wanted to set a standard for accessing, communicating and doing business over the internet.

America Online tried to invest in Netscape’s first round of financing in 1994 and also attempted to license Navigator, however neither action was successful. After a partnership proposal with Netscape was turned down in 1996, AOL partnered made Internet Explorer its default browser. The case gives three arguments for this agreement, “It(Internet Explorer) was free, Microsoft would customize the browser to provide seamless integration with AOL, and Bill Gates was willing to bundle access to AOL with Windows 95.” AOl further entrenched itself in the browser battle by acquiring Netscape in 1998.