Federal Court Order Terminates Portion Of 1956 Consent Decree

Business Wire, Jan 23, 1996

ARMONK, N.Y.--(BUSINESS WIRE)--Jan. 23, 1996--IBM announced today that a federal court order issued last week terminates part of the forty-year-old consent decree between IBM and the U.S. Government. The order, issued January 17 by Judge Allan G. Schwartz of the U.S. District Court for the Southern District of New York, ends unique restrictions on IBM's services and systems integration business. The order also terminates the decree in its entirety for all IBM products except its S/390 and AS/400 families.

IBM believes Judge Schwartz's order represents an important first step in its efforts to be free of the artificial constraints of a decree put in place four decades ago when the computer industry as it is known today did not exist. While the Department of Justice agreed to the partial termination, it has not yet determined whether it will support IBM's motion to terminate the decree in its entirety. As a result, IBM indicated the proceedings initiated by the company in June 1994 will continue before Judge Schwartz.

Lawrence R. Ricciardi, senior vice president and general counsel of IBM said: "Even as amended by the judge's order, the decree represents an unnecessary and unwarranted limitation on legitimate business conduct by IBM. We should be free to compete on the merits of our products and services, constrained only by the natural forces of an intensely competitive marketplace and the demands of our customers, and by the same antitrust laws that govern our competitors."

IBM would not speculate on whether termination of part of the consent decree would result in organizational or other changes to the company's business operations.

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