ORDER OF THE PRESIDENT OF THE GRAND CHAMBER OF THE COURT OF FIRST INSTANCE
28 November 2005 (*)
(Intervention – Article 116(6) of the Rules of Procedure of the Court of First Instance – Association not having as its object the protection of the interests of its members – Companies not having an interest in the result of the dispute)
In Case T-201/04,
Microsoft Corp., established in Redmond, Washington (United States), represented by J.-F. Bellis, lawyer, and I.S. Forrester QC,
applicant,
supported by
Association for Competitive Technology, Inc., established in Washington, DC (United States), represented by L. Ruessmann, lawyer,
DMDsecure.com BV, established in Amsterdam (Netherlands),
MPS Broadband AB, established in Stockholm (Sweden),
Pace Micro Technology plc, established in Shipley (United Kingdom),
Quantel Ltd, established in Newbury (United Kingdom),
Tandberg Television Ltd, established in Southampton (United Kingdom),
represented by J. Bourgeois, lawyer,
Exor AB, established in Uppsala (Sweden), represented by S. Martínez Lage, H. Brokelmann and R. Allendesalazar Corcho, lawyers,
Mamut ASA, established in Oslo (Norway),
TeamSystem SpA, established in Pesaro (Italy),
represented by G. Berrisch, lawyer,
The Computing Technology Industry Association, Inc., established in Oakbrook Terrace, Illinois (United States), represented by G. van Gerven and T. Franchoo, lawyers, and B. Kilpatrick, Solicitor,
interveners,
v
Commission of the European Communities, represented by R.B. Wainwright, F. Castillo de la Torre, P. Hellström and A. Whelan, acting as Agents, with an address for service in Luxembourg,
defendant,
supported by
Audiobanner.com, trading as VideoBanner, established in Los Angeles, California (United States), represented by L. Alvizar, lawyer,
European Committee for Interoperable Systems (ECIS), established in Brussels (Belgium), represented by D. Paemen and N. Dodoo, lawyers,
Free Software Foundation Europe eV, established in Hamburg (Germany), represented by C. Piana, lawyer,
RealNetworks, Inc., established in Seattle, Washington (United States), represented by A. Winckler, M. Dolmans and T. Graf, lawyers,
Software & Information Industry Association (SIIA), established in Washington, DC, represented by C. Simpson, Solicitor, and D. Paemen and N. Dodoo, lawyers,
interveners,
APPLICATION for annulment of Commission Decision C(2004) 900 final relating to a proceeding under Article 82 EC (Case COMP/C-3/37.792 – Microsoft) or, in the alternative, annulment of or reduction in the fine imposed on the applicant in that decision,
THE PRESIDENT OF THE GRAND CHAMBER OF THE COURT OF FIRST INSTANCE OF THE EUROPEAN COMMUNITIES
makes the following
Order
Facts and procedure
1 Microsoft Corp. (‘Microsoft’ or ‘the applicant’), a company established in Redmond, Washington (United States), designs, develops and markets a wide range of software for different types of computer equipment. That software includes operating systems for personal computers (‘PCs’), known as Windows, work group server operating systems, known as Windows Server, and streaming media players, known as Windows Media Player. Microsoft also provides technical assistance for its software.
2 On 10 December 1998, Sun Microsystems, Inc., a company established in Palo Alto, California (United States), which supplies, inter alia, workgroup server operating systems, lodged a complaint with the Commission.
3 In its complaint, Sun Microsystems complained that Microsoft had refused to supply it with the information and technology necessary to allow interoperability of its work group server operating systems with Windows.
4 On 2 August 2000, the Commission sent Microsoft a first statement of objections. That statement of objections focused essentially on questions of the interoperability between Windows PC operating systems and operating systems for other suppliers’ servers (‘client-to-server interoperability’).
5 In February 2000, the Commission launched on its own initiative an investigation into Microsoft’s ‘Windows 2000’ PC and work group server operating systems and into Microsoft’s integration of its ‘Windows Media Player’ software into its PC operating systems.
6 That investigation culminated in a second statement of objections being sent to Microsoft on 29 August 2001. In that statement of objections, the Commission reiterated its previous objections concerning client-to-server interoperability. The Commission also addressed a number of questions relating to interoperability between work group servers (server-to-server interoperability). Last, the Commission raised certain questions relating to the integration of Windows Media Player into Microsoft’s PC operating systems.
7 On 6 August 2003, the Commission sent Microsoft a third statement of objections intended to supplement the two previous statements and to give an indication of the remedies which it proposed to order.
8 On 24 March 2004, the Commission adopted Decision C(2004) 900 final relating to a proceeding under Article 82 EC (Case COMP/C-3/37.792 – Microsoft) (‘the contested decision’).
9 In assessing Microsoft’s conduct, the Commission first identified three distinct product markets, consisting of client PC operating systems, work group server operating systems and streaming media players.
10 Second, the Commission considered that each of those markets was worldwide.
11 Third, the Commission found that Microsoft held a dominant position on the client PC operating system market and the work group server operating system market.
12 Fourth, it concluded that, by its conduct on those two markets, Microsoft was infringing Article 82 EC. First, it considered that Microsoft was abusing its dominant position by refusing to supply the interoperability information and to authorise its use for the development and distribution of products competing with its own products on the work group server operating system market during the period October 1998 to the date of notification of the contested decision (Article 2(a) of the contested decision). The Commission also considered that Microsoft was abusing its dominant position by making the availability of the Windows client PC operating system conditional on the simultaneous acquisition of Windows Media Player during the period May 1999 to the date of notification of the contested decision (Article 2(b) of the contested decision).
13 Fifth, the Commission imposed a fine of EUR 497 196 304 on Microsoft (Article 3 of the contested decision).
14 Sixth, it ordered Microsoft to bring the abovementioned infringements to an end, to refrain from any conduct having the same or equivalent object or effect and to implement a series of remedies within certain periods (Articles 4 to 8 of the contested decision).
15 By application lodged at the Registry of the Court of First Instance on 7 June 2004, Microsoft brought an action for annulment of the contested decision or, in the alternative, annulment of or reduction in the fine.
16 By application lodged at the Registry on 6 June 2005, The International Association of Microsoft Certified Partners, Inc. (‘IAMCP’), established in Markham, Ontario (Canada), represented by D. Beard, Barrister, and W. Allan and N. Seavy, Solicitors, sought leave to intervene in the proceedings in support of the form of order sought by the applicant.
17 By application lodged at the Registry on 12 August 2005, International Intellectual Property Institute (‘IIPI’), established in Washington, DC (United States), Institute for Policy Innovation (‘IPI’), established in Lewisville, Texas (United States) and Progress & Freedom Foundation (‘PFF’), established in Washington, DC, represented by A. Pérez Ocón, lawyer, sought leave to intervene in the proceedings in support of the form of order sought by the applicant.
18 The applications to intervene were served on the parties, in accordance with the first paragraph of Article 116(1) of the Rules of Procedure of the Court of First Instance.
19 The following parties submitted written observations on the application to intervene lodged by IAMCP:
– the applicant, by document lodged at the Registry on 20 June 2005;
– the intervener Free Software Foundation Europe eV, by document lodged at the Registry on 28 June 2005;
– the intervener Software & Information Industry Association, by document lodged at the Registry on 30 June 2005; and
– the Commission, by document lodged on 30 June 2005.
20 The following parties submitted written observations on the application to intervene lodged by IIPI, IPI and PFF:
– the interveners DMDsecure.com BV, MPS Broadband AB, Pace Micro Technology plc, Quantel Ltd and Tandberg Television Ltd, by document lodged at the Registry on 19 September 2005;
– the intervener Software & Information Industry Association, by document lodged at the Registry on 22 September 2005; and
– the Commission, by document lodged at the Registry on 22 September 2005.
The application to intervene by IAMCP
Arguments of IAMCP and of the parties which submitted observations
21 IAMCP claims that it satisfies the conditions governing the right to intervene applicable to representative associations and that it should therefore be granted leave to intervene in support of the form of order sought by the applicant.
22 First, it claims to represent a significant number of operators active in the sector concerned. It states that it is a not-for-profit corporation incorporated in the State of Delaware (United States), with more than 1 500 members worldwide (including more than 400 in the European Union), organised into local chapters. All of its members are active in the information technology or software sectors and are ‘Microsoft Certified Partners’ or ‘Microsoft Registered Members’ who specialise in using or working with Windows operating systems. IAMCP explains that its representative role relates exclusively to its members’ interests in Microsoft systems and technology.
23 Second, IAMCP submits that its objectives include protecting the interests of its members. As a company incorporated in the State of Delaware, and pursuant to its corporate purposes as set out in its Certificate of Incorporation, it has the usual powers to engage in any lawful act or activity permitted by the State of Delaware corporation law and, in particular, the power provided in the General Corporation Law to sue and be sued and participate as a party or otherwise in any judicial proceeding. It also lists the objectives which, in accordance with its bylaws, it is called upon to pursue.
24 Third, IAMCP maintains that the case raises questions of principle affecting the functioning of the sector concerned.
25 Fourth, IAMCP claims that the interests of its members will be affected to an appreciable extent by the forthcoming judgment. As regards the question of interoperability, IAMCP maintains that if the contested decision should be upheld by the Court, Microsoft would have less incentive to innovate, which would have negative consequences for the activities of its members. As regards the question of tying, IAMCP claims that the continued integration of new functionalities into Windows is particularly important to its members and leads to lower costs both for them and for their customers.
26 Last, IAMCP submits that it is ideally placed to comment on the interoperability issue and that no other intervener in the proceedings is sufficiently concerned with the interests of small or medium-sized operators.
27 The applicant submits that IAMCP should be granted leave to intervene in the proceedings.
28 The Commission and the intervener Software & Information Industry Association contend that IAMCP’s application to intervene should be dismissed and that it should be ordered to pay the costs. They claim that IAMCP’s function is not to protect or represent the interests of its members but that it merely constitutes a discussion and cooperation forum for its members. The Commission observes that IAMCP did not participate in the administrative procedure that led to the adoption of the contested decision or, to its knowledge, in the United States antitrust infringement proceedings. The Commission and the intervener Software & Information Industry Association also submit that the arguments which IAMCP puts forward in support of its argument that the forthcoming judgment is likely to affect the interests of its members to an appreciable extent are vague, abstract and unsubstantiated.
29 As regards the intervener Free Software Foundation Europe eV, although it does not formally submit that IAMCP’s application to intervene should be dismissed, it emphasises that the latter is not empowered to defend the interests of its members.
Findings of the Court
30 The second paragraph of Article 40 of the Statute of the Court of Justice, which pursuant to the first paragraph of Article 53 of that Statute is applicable to the procedure before the Court of First Instance, provides that any person establishing an interest in the result of a case, with the exception of cases between Member States, between institutions of the Communities or between Member States and institutions of the Communities, is to be entitled to intervene in that case.
31 According to settled case-law, leave to intervene may be allowed to representative associations whose object is to protect their members in cases raising questions of principle that are liable to affect those members (orders of the President of the Court of Justice of 17 June 1997 in Joined Cases C-151/97 P(I) and C-157/97 P(I) National Power and PowerGen [1997] ECR I-3491, paragraph 66, and of 28 September 1998 in Case C-151/98 P(I) Pharos v Commission [1998] ECR I-5441, paragraph 6; and order of the President of the Court of First Instance of 26 July 2004 in Case T‑201/04 R, not yet published in the ECR, paragraph 37). More particularly, an association may be granted leave to intervene in a case if it represents an appreciable number of undertakings active in the sector concerned, and if its interests may therefore be affected to an appreciable extent by the forthcoming judgment (orders of the Court of First Instance of 8 December 1993 in Case T-87/92 Kruidvat v Commission [1993] ECR II-1363, paragraph 14, and of 28 May 2004 in Case T-253/03 Akzo Nobel Chemicals and Akros Chemicals v Commission, not yet published in the ECR, dismissing the application to intervene of the Section on Business Law of the International Bar Association, paragraph 18; order in Microsoft v Commission, cited above, paragraph 37).
32 In the present case, Article 1, Section 2 of IAMCP’s Bylaws provides that the objectives of that association are as follows:
‘2.1 To cooperate with Microsoft Corporation and other business entities and organised groups in the field of software development, IT consulting, systems integration and IT training; to develop and conduct educational programs.
2.2 To assist Members by facilitating the dissemination of technical information, marketing assistance and professional development.
2.3 To provide a forum for discussion of business and technical issues related to the software industry; to enable networking and partnering between and among each other and to facilitate communications with Microsoft Corporation and other related business entities and organised groups.
2.4 To conduct meetings, seminars, conferences, educational courses, conventions and otherwise operate in a manner consistent with achieving the objectives set out in Section 2.
2.5 To promote partnering among its members.
2.6 To formulate a Code of Professional Ethics and Standards of Professional Practice to which we expect our members to adhere.’
33 The Court finds that, contrary to IAMCP’s contention, its objects do not include the protection of its members’ interests or the representation of its members. In reality, its essential objective is to promote, among its members, an exchange of information and discussion on trade and technical issues of interest to them and also partnering, to help its members to cooperate with Microsoft and other bodies active in the software and information technology sector and to organise meetings and conferences.
34 That finding is not called in question by the argument which IAMCP derives from the fact that in its capacity as a Delaware corporation, and in accordance with its objects as described in its certificate of incorporation, it has the usual power to engage in any lawful act or activity permitted by the company law of that State, including the power to sue or be sued. The fact that it has the power to sue or be sued, or to participate in judicial proceedings in any other capacity, is merely the consequence of the fact that it has legal personality under the law of the State of Delaware, but does not show that its object is to protect the interests of its members. IAMCP’s Certificate of Incorporation proves only its existence in law, under the law of the State of Delaware, for the purposes of the application of Article 44(5)(a) of the Rules of Procedure. Although that proof of its existence in law is necessary (see, to that effect, order in Akzo Nobel Chemicals and Akcros Chemicals v Commission, cited at paragraph 31 above, dismissing the application to intervene by the European Council on Legal Affairs, paragraphs 18 and 19), it does not in itself constitute a sufficient ground for its application to intervene to be allowed (see, to that effect, order in Akzo Nobel Chemicals and Akcros Chemicals v Commission).
35 It should further be pointed out that IAMCP did not participate in the administrative procedure which led to the adoption of the contested decision (see, to that effect, order in Kruidvat v Commission, cited at paragraph 31 above).
36 The application to intervene by IAMCP will therefore be dismissed.
The application to intervene by IIPI, IPI and PFF
Arguments of IIPI, IPI and PFF and of the parties which submitted observations
37 IIPI, IPI and PFF state that they are not-for-profit-corporation ‘think tanks’ whose missions involve the promotion globally of strong intellectual property rights in the technology sector, including software and information technology, as a means of encouraging innovation and economic development.
38 They claim that they have a direct and present interest in the result of the case in that the contested decision creates a potent obstacle to the ‘success’ of their mission. They maintain that the decision affects copyright in the information technology field and specifically establishes a new test for compulsory licensing of copyright that purports to promote innovation in that field. In their submission, ‘the proper protection of copyrighted material [in order] to promote innovation is a particular and significant focus of each of [the present applicants for leave to intervene]’.
39 IIPI, IPI and PFF further maintain that by ordering the compulsory licensing of Microsoft’s copyright-protected interoperability information, the contested decision violates the principles of the enforceability of strong intellectual property rights throughout the world as defined in the Berne Convention for the Protection of Literary and Artistic Works of 9 September 1886 (Paris Act 1971), the Agreement on Trade-Related Aspects of Intellectual Property Rights administered by the World Trade Organisation and the WIPO Copyright Treaty.
40 The interveners DMDsecure.com BV, MPS Broadband AB, Pace Micro Technology plc, Quantel Ltd and Tandberg Television Ltd state that they have no objections to the application by IIPI, IPI and PFF.
41 The Commission and the intervener Software & Information Industry Association contend that the application to intervene by IIPI, IPI and PFF should be dismissed and that the latter should be ordered to pay the costs.
42 The Commission observes, first of all, that IIPI, IPI and PFF are not representative associations but corporations, with no members at all, that pursue their own individual interests. Nor have IIPI, IPI and PFF demonstrated the existence of an interest in the result of the case. Those corporations are not active on any relevant market in the sector concerned or on a related market.
43 The intervener Software & Information Industry Association maintains that IIPI, IPI and PFF do not show a direct, present and specific interest in the result of the case. Nor do they show that they have capacity to take part in the proceedings.
Findings of the Court
44 It has consistently been held that the concept of an interest in the result of the case, within the meaning of the second paragraph of Article 40 of the Statute of the Court of Justice, must be defined in the light of the precise subject-matter of the dispute and be understood as meaning a direct, existing interest in the ruling on the forms of order sought and not as an interest in relation to the pleas in law or arguments put forward. The expression ‘solution’ is to be understood as meaning the final judgment which the parties ask the Court to deliver. It is necessary, in particular, to ascertain whether the intervener is directly affected by the contested decision and whether his interest in the result of the case is established (order of the Court of Justice in Joined Cases 116/77, 124/77 and 143/77 Amylum and Others v Council and Commission [1978] ECR 893, paragraphs 7 and 9; order in National Power and PowerGen, cited above, paragraphs 51 to 53; and order of the Court of First Instance of 25 February 2003 in Case T-15/02 BASF v Commission [2003] ECR II-213, paragraph 26).
45 It is quite clear that IIPI, IPI and PFF have not shown an interest in the result of the case within the meaning of the case-law cited above.
46 In that regard, it should be pointed out that the three corporations are not active in any of the markets concerned by the contested decision, nor do they carry out commercial activities on a market upstream or downstream from one of those markets. As they define themselves, they are in reality mere ‘think tanks’ whose objects include, in particular, the promotion of strong intellectual property rights in the information technology field. To that end, they publish articles, works and information bulletins, carry out research and organise meetings, training seminars and conferences.
47 It is difficult to understand in what way the solution which the Court will arrive at in the case is capable of affecting, in any way whatsoever, the legal position of IIPI, IPI and PFF and, in particular, the proper conduct of their mission or their activities, as described above. Whether the Court upholds the substance of the contested decision or whether it annuls it in whole or in part, those three corporations will be fully able to continue to promote their theory that the existence of strong intellectual property rights in the information technology field promotes innovation and economic development.
48 The interest which IIPI, IPI and PFF claim is in fact merely an indirect, and purely abstract and academic, interest. At most, it might be considered that they have an interest by reference to certain theories or certain arguments put forward by Microsoft. Such an interest, however, cannot constitute a sufficient interest in the result of the case for the purposes of the application of the second paragraph of Article 40 of the Statute of the Court of Justice.
49 In the light of the foregoing considerations, the application to intervene by IIPI, IPI and PFF must be dismissed.
Costs
50 Under Article 87(1) of the Rules of Procedure, a decision as to costs is to be given in the final judgment or in the order which closes the proceedings. As the present order closes the proceedings so far as the present applicants to intervene are concerned, it is appropriate to make an order as to the costs associated with their application to intervene.
51 Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings.
52 As IAMCP has been unsuccessful in its application, it must be ordered to bear its own costs and to pay the costs incurred by the Commission and the intervener Software & Information Industry Association in connection with its application to intervene, in accordance with the forms of order sought by those parties. As the applicant and the intervener Free Software Foundation Europe eV have not applied for costs, they must bear their own costs.
53 As IIPI, IPI and PFF have been unsuccessful in their application, they must be ordered to bear their own costs and to pay the costs incurred by the Commission and the intervener Software & Information Industry Association in connection with their application to intervene, in accordance with the forms of order sought by those parties. As DMDsecure.com BV, MPS Broadband AB, Pace Micro Technology plc, Quantel Ltd and Tandberg Television Ltd have not asked for costs, they must bear their own costs.
On those grounds,
THE COURT OF FIRST INSTANCE
hereby orders:
1. The application to intervene by The International Association of Microsoft Certified Partners, Inc. is dismissed.
2. The International Association of Microsoft Certified Partners, Inc. shall bear its own costs and also pay the costs incurred by the Commission and by Software & Information Industry Association in connection with its application to intervene.
3. The applicant and Free Software Foundation Europe eV shall bear the costs which they have incurred in connection with the application to intervene by The International Association of Microsoft Certified Partners, Inc.
4. The application to intervene by International Intellectual Property Institute, Institute for Policy Innovation and Progress & Freedom Foundation is dismissed.
5. International Intellectual Property Institute, Institute for Policy Innovation and Progress & Freedom Foundation shall bear their own costs and pay the costs incurred by the Commission and by Software & Information Industry Association in connection with their application to intervene.
6. DMDsecure.com BV, MPS Broadband AB, Pace Micro Technology plc, Quantel Ltd, and Tandberg Television Ltd shall bear the costs which they have incurred in connection with the application to intervene by International Intellectual Property Institute, Institute for Policy Innovation and Progress & Freedom Foundation.
Luxembourg, 28 November 2005.