United States state officials, fresh from winning an unprecedented settlement with the tobacco industry, have joined forces again to consider a national anti-trust battle against Microsoft.
If the attorneys general collaborate on a multi-state action, it will add to the legal woes of Microsoft, which is already battling a Justice Department lawsuit that alleges the giant software company violated a 1995 anti-trust agreement.
"I think action by the states is close to a certainty," Connecticut attorney general, Mr Richard Blumenthal told Reuters.
He expected that the state attorneys general would decide by early next year whether to take action against Microsoft, which employs 1,200 people in Ireland. The California attorney general's office, meanwhile, said it was investigating Microsoft.
Although it is not unusual for the attorneys general to work together in bringing civil consumer fraud actions, their unified power has gained new respect since the tobacco deal, which was reached on June 20th.
In the $368.5 billion (£253.5 billion) settlement, the attorneys general won concessions from the powerful tobacco industry, which had boasted it never spent a cent on personal injury damages and would never settle a lawsuit.
Representatives from nine states met in Chicago for three days last week to discuss a possible strategy for suing Microsoft. Other states involved in the talks are Texas, Illinois, Minnesota, Wisconsin and Massachusetts.
California is not the only state with its own investigation under way. Texas sued Microsoft last month, alleging the state's antitrust probe was being impeded by Microsoft's licensing agreement, which requires client companies to notify the Washington-based software giant before talking to government investigators.
Attorneys for Texas and Microsoft could be back in an Austin court as early as January to argue whether the company should be forced to drop the provision.
A Microsoft spokesman said the company had not been contacted by any of the states except Texas. "We would welcome the opportunity to meet with each of the state attorney general's offices and provide them with our perspective on competition in the software industry," Mr Mark Murray said.
Meanwhile, Microsoft is appealing last week's ruling by a federal judge in the Justice Department anti-trust lawsuit, which temporarily blocks Microsoft from requiring computer makers to use its Internet software along with its popular Windows 95 and other operating systems.
In its lawsuit, the department alleges that Microsoft has unfairly pressured computer makers into taking its Web browser, Internet Explorer, over rival products from Netscape Communications. A browser allows users to access the Web and other information on the Internet.
Mr Murray said Microsoft's rivals were largely to blame for the company's current wave of legal difficulties.
In the wake of last week's federal court ruling, personal computer makers said they won't stop including Microsoft's Internet Explorer on their products despite the company being forbidden from requiring them to use it.
Compaq Computer and IBM said they'll also include rival Netscape's browser on some PCs, in order to offer consumers the most choices in software and try to steer clear of taking sides in the browser battle between Microsoft and Netscape.
"It's a benefit to our customers to be able to offer both. We will do whatever our customers want," said IBM spokesman, Mr Bill Hughes.
