The DOJ and 20 U.S. states filed an antitrust case against Microsoft on May 18, 1998. The DOJ was initially represented by David Boies. US District Court Judge Thomas Penfield Jackson then issued a preliminary ruling on November 5, 1999 that Microsoft had "monopoly power".
On April 3, 2000, in a two-part decision, Judge Thomas Penfield Jackson ruled in Washington, D.C that Microsoft's dominance of the personal computer operating systems market constituted a monopoly, and that it used its power against competitors in ways that stifled innovation and harmed consumers (the "findings of fact"). Judge Jackson ordered the breakup of Microsoft into two separate units, one to produce the operating system, and one to produce other software components (the "remedies").
Judge Jackson's remedy was overturned on appeal on the grounds that interviews he gave to the news media during the case prove a personal bias. Judge Jackson disputes these charges. Jackson's findings of fact, however, remain substantially unchanged.
The DOJ, now under the administration of U.S. President George W. Bush, announced on September 6, 2001 that it was no longer seeking to break-up Microsoft and would instead seek a lesser antitrust penalty. Then on November 2, 2001, the DOJ forged an agreement with Microsoft to settle the case. Nine States and the District of Columbia, which had been pursuing the case together with the DOJ, have not agreed with the settlement, arguing that it does not go far enough to curb Microsoft's anti-competitive business practices.
On August 5, 2002, Microsoft announced that it would make some concessions towards the proposed final settlement of its antitrust case ahead of the judge's verdict. On November 1, 2002, Judge Colleen Kollar-Kotelly released a judgment essentially accepting the proposed DOJ settlement. The dissenting States, along with much of the computer industry, regarded this as merely a slap on the wrist.