IBM comes under antitrust scanner

IBM comes under antitrust scanner

This month, antitrust regulators at the Justice Department began seeking information about IBM’s business practices from companies that compete with IBM in the market for large computer hardware and software, people who had been contacted in the inquiry said.

The requests for information followed a complaint filed by the Computer & Communications Industry Association, a trade group with a history of involvement in antitrust disputes. The organization, which is backed by IBM competitors like Microsoft and Oracle, contends that IBM stymied competition in the mainframe market and blocked efforts by competitors and potential partners to license IBM’s software.

The complaint follows similar legal action taken by T3 Technologies against IBM.  T3, a small company that resold mainframelike computers, filed an antitrust complaint against IBM in January in Europe. T3 also filed a civil suit against IBM in the United States. Last week a federal district judge in New York dismissed that case. T3 said it planned to appeal.

Steven Friedman, President of T3, said he had received a formal request for information from the Justice Department about IBM’s actions in the mainframe market. “They asked for a very broad set of documents and information,” he said.

Edward J Black, Chief Executive of Computer & Communications Industry Association, confirmed that it had filed a complaint against IBM with the Justice Department and that investigators had contacted some members.

A Justice Department spokeswoman declined to comment. The inquiry is the early stages and may not result in charges against IBM. The last time federal regulators pursued an antitrust suit against IBM in the mainframe market, the result was a humbling setback for the department when the Reagan administration dropped the case in 1982, after 13 years. In a statement on Wednesday, IBM cited the judge’s ruling last week against T3 and said, “We continue to believe there is no merit to T3’s claims.”

“We understand the Department of Justice has asked T3 for documents from the litigation,” I.B.M. said. “I.B.M. intends to cooperate with any inquiries from the Department of Justice.”