DOJ Files Microsoft Antitrust Suit, Establishes Tech Monopoly Precedent

The U.S. Department of Justice, joined by Attorneys General from 20 states and the District of Columbia, files antitrust charges against Microsoft on May 18, 1998, alleging the company violated the Sherman Act by using its operating system dominance to thwart competition. The complaint charges four distinct violations: unlawful exclusive dealing arrangements, unlawful tying of Internet Explorer to Windows 95/98, unlawful maintenance of a monopoly in the PC operating system market, and unlawful attempted monopolization of the internet browser market. On November 5, 1999, Judge Thomas Penfield Jackson issues findings of fact, followed by conclusions of law on April 3, 2000, finding Microsoft committed multiple Sherman Act violations. On June 7, 2000, Jackson orders Microsoft’s breakup, separating its operating system business from applications. However, the D.C. Circuit Court of Appeals on June 28, 2001, overturns the breakup order while affirming the monopoly maintenance finding, citing improper judicial conduct (media contacts). The Bush administration DOJ announces on September 6, 2001, it will no longer seek breakup, settling instead on November 1, 2001, for behavioral restrictions requiring Microsoft to share APIs with third-party developers. The final settlement enters November 1, 2002, though nine states argue it doesn’t go far enough. The case establishes a critical precedent: tech monopolies can maintain market dominance through anticompetitive practices, face years of litigation, yet ultimately avoid structural remedies through political transitions and regulatory capture, laying groundwork for future tech giant monopolies including Google, Facebook, Amazon, and Apple to engage in similar practices with minimal consequences.