#28 Fall 2000


#28 Fall 2000 Page 1

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."

#28 Fall 2000 Page 2

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

#28 Fall 2000 Page 3

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?"

     A. 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

#28 Fall 2000 Page 4

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.

TAFOL's brief is being mailed to all those who have recently contributed to TAFOL. The brief also can be viewed on the web [on this web site www.tafol.org at “Briefs”].

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.]


TAFOL's Board of Directors has approved the publication of an Objectivist law review to be published annually commencing in the summer of 2002. The purposes of the review are to provide a forum for critical commentary on current and historical law, and to provide a platform for scholarly work and scholarly exchanges on the subject of an ideal or rational system of laws.

Prospective authors may request authors' guidelines and a time line for submission by writing to:
TAFOL Law Review [address omitted]
or by sending an e-mail to [address omitted] (Dee Tagliavia).

Authors need not be TAFOL contributors or lawyers; however, articles should have legal content, contain analysis from an Objectivist perspective and be of law review quality.

#28 Fall 2000 Page 5


On February 6, argument was heard in the Fifth Circuit Court of Appeals on the never-ending IOLTA case. As readers of this Bulletin know, TAFOL has been supporting several plaintiffs in their attack on a program, operable in many states, that requires lawyers to place certain of their clients' funds in interest-bearing bank accounts and to give the interest to a state agency for use in providing legal services to low-income persons.

The Supreme Court had ruled that "the interest income generated by the funds held in IOLTA accounts is the private property of the owner of the principal." The trial court again ruled against the plaintiffs who again appealed to the Court of Appeals. Charles Fried, professor of law at Harvard University, a former solicitor general of the United States, and a former justice of the Massachusetts Supreme Judicial Court1 argued for plaintiffs.

The issues are very technical. They concern whether a court can issue an injunction against a state agency. We are hopeful once again for a favorable ruling.

1. Professor Fried had also represented the Florida legislature in Bush v. Gore and Merrill-Dow in the landmark Daubert case (involving the standards for the admissibility of expert testimony).


TAFOL invites its supporters to communicate via U.S. mail, using the new address listed on the first page. As described below, the change was made necessary by improper political philosophy.

Some years ago, Bob Getman, who lives in New York and was in charge of the contributor records, rented a post office box in New York for TAFOL. A few years later, when Steve Plafker, who lives in Los Angeles, took over this function, TAFOL decided to keep its box to avoid the necessity of changing addresses. (With address changes comes lost mail.) We arranged for the Postal Service to forward our mail to our treasurer, Mike Conger, in Kansas City, Missouri every month (for which, of course, we paid a fee). Unfortunately, it is today considered proper for the government to run a post office and, in the name of egalitarianism, to use force to prevent others from doing the same. (See the lead article of the summer 1999 issue.) As a consequence, the postal authorities do not consider it necessary to honor their contracts. TAFOL was getting its communications sporadically---and only after numerous phone calls.

Although we will be closing the old post office box, the postmaster will forward mail under its normal procedures for a period of time; however, please communicate with us through the new one. It will be faster and more reliable. Supporters may also contact us via TAFOL's e-mail address: [address omitted].

[Now see “Contact Us” on this web site.]

Copyright © 2001 The Association for Objective Law. All rights reserved. The Association for Objective Law is a Missouri non-profit corporation whose purpose is to advance Objectivism, the philosophy of Ayn Rand, as the basis of a proper legal system.