However, the French foreign minister also said that "everything should be done to avoid war."

"War is the worst that could happen," he said. "Everything should be done to avoid war. We have to negotiate, negotiate, negotiate -- without cease, without rebuff."

His comments appeared aimed at quieting an uproar over his statement Sunday that the world should prepare for a possible war with Iran -- a warning Iranian President Mahmoud Ahmadinejad dismissed Tuesday as fanciful.

Kouchner blamed the media for distorting his statement that "we have to prepare for the worst, and the worst is war."

"As usual with journalists, they take one phrase and you don't know what came after," he told Russia's Echo of Moscow radio late Tuesday.

"They're saying: Bernard Kouchner wants war. But it's not true. It's a manipulation. I don't want war, I want peace."

The Russian and French ministers met ahead of a UN Security Council meeting on Friday that may impose new sanctions against Tehran for its controversial uranium enrichment activity.

Ahmadinejad dismissed talk of war in comments to journalists in Tehran on Tuesday.

"We do not take these declarations seriously. Comments to the media are different to the real positions," he said.

Tehran vehemently denies US accusations it is seeking an atomic weapon, saying its nuclear drive is aimed at generating electricity.

Russia, which is building Iran's first nuclear reactor in the southern Russian city of Bushehr, has consistently warned against attacking the Islamic republic.

In an interview published just ahead of the Kouchner-Lavrov meeting, Russian Deputy Foreign Minister Alexander Losyukov warned that a "bombing of Iran would be a bad move that would end with catastrophic consequences."

The United States has never ruled out using military strikes to punish Iran for defying UN Security Council demands that it halt its enrichment activity. US Defense Secretary Robert Gates said on Sunday that "all options are on the table."

Iran has said it would never initiate an attack but would respond with crushing force if the United States launched a strike on its territory.

Kouchner is set to fly to Washington on Wednesday to take up the issue with US Secretary of State Condoleezza Rice.

Fearing possible military action, Moscow has drawn up plans to evacuate its nuclear experts from Bushehr in the event of a conflict, deputy foreign minister Losyukov said.

He stressed in an interview with daily Vremya Novostei that the use of force would only "worsen the situation in the Middle East" and "bring a very negative reaction from the Muslim world."

On Monday, the UN atomic agency chief warned against the hasty use of force in the Iranian nuclear dispute but dismissed the French comments about possible war as "a lot of hype."

"We need always to remember that use of force could only be resorted to when ... every other option has been exhausted. I don't think we are at all there," ElBaradei told reporters at a conference of his International Atomic Energy Agency (IAEA).

"There is a UN charter and there are rules for the international use of force," ElBaradei said.

Iranian Vice President Reza Aghazadeh told the general conference of the IAEA's 144 member states that Western countries "have always chosen the path of confrontation instead of the path of understanding and cordial relations toward the great nation of Iran."

A series of bombings, meanwhile, ripped through Baghdad, killing at least 18 people and wounding more than 60, police said. The deadliest attack was a car bombing in a parking lot near the Health Ministry and the city's main morgue that claimed seven lives.

The Interior Ministry said Monday that Blackwater — a Moyock, N.C.-based company that protects U.S. diplomats and other dignitaries and projects in Iraq — was banned from working in the country after Sunday's deadly shootings that apparently occurred after a car bombing in western Baghdad.

The shootings have touched a nerve and raised scrutiny over what many Iraqis consider a mercenary force that runs roughshod over people in their own country.

Blackwater is one of three private security firms employed by the State Department to protect its personnel in Iraq, and a decision to force it to pull out would create tremendous difficulties for the U.S. government.

The two other firms, both of which are headquartered in the Washington, D.C., suburbs, are Dyncorp, based in Falls Church, Va., and Triple Canopy, based in Herndon, Va.

Government spokesman Ali al-Dabbagh said he understood the need for protection for Westerners and dignitaries but that preliminary findings showed Blackwater used excessive force.

Citing Interior and Defense ministry initial findings, al-Dabbagh told CNN that more than 20 people were killed. Interior Ministry spokesman Maj. Gen. Abdul-Karim Khalaf, however, said 11 were killed. The discrepancy could not be reconciled.

Blackwater has insisted its employees acted in self-defense and that those killed were armed combatants who threatened State Department personnel.

Both Iraqi officials appeared to soften the government's position after Secretary of State Condoleezza Rice assured Prime Minister Nouri al-Maliki of a fair and transparent investigation.

"We have to protect the people. At the same time we have to show the sovereignty of the government in Iraq," al-Dabbagh told CNN.

But he stressed the ban on Blackwater was temporary pending the final investigation: "We are not intending to stop them and revoke their license indefinitely, but we do need them to respect the law and the regulation here in Iraq."

Khalaf said the important thing was "to know the truth and to protect the rights of the victims and to reach the best means in order to prevent such incidents in the future."

Blackwater and other foreign contractors accused of killing Iraqi citizens have gone without facing charges or prosecution in the past, and it was unclear why the shooting Sunday drew such a fierce reaction by the Iraqi government.

Al-Maliki, under political pressure, may have seen a straightforward way to gain political ground by lashing out at a practice unpopular with all Iraqis. Unlike many deaths blamed on foreign contractors, Sunday's shootings took place in a crowded area in downtown Baghdad with dozens of witnesses.

The Interior Ministry also has recently clamped down on weapons permits for the foreign security companies with a series of conflicting measures that have created some confusion among Iraqi security forces as well as the contractors.

The circumstances surrounding Sunday's attack were uncertain. Blackwater said its employees came under fire.

"Blackwater regrets any loss of life but this convoy was violently attacked by armed insurgents, not civilians, and our people did their job to defend human life," Blackwater's spokeswoman, Anne E. Tyrrell, said in a statement.

U.S. officials said the motorcade was traveling through Nisoor Square on the way back to the Green Zone when the car bomb exploded, followed by volleys of small-arms fire that disabled one of the vehicles.

Al-Dabbagh said the preliminary report by the Interior and Defense ministries showed helicopters fired on the crowd; Blackwater has denied any aircraft were used.

Al-Sadr called for all contracts of foreign securities firms to be annulled and blamed the government for failing to protect Iraqis, noting the shootings occurred on a busy square filled with Iraqi troops.

"This aggression wouldn't have happened had it not been for the presence of the occupiers who brought these companies," al-Sadr's political committee said in a statement issued by his office in the holy city of Najaf.

It also called for a speedy investigation, the referral of those involved to the Iraqi justice system and compensation for families of the victims.

Amid allegations that the foreign security contractors operate with impunity, al-Maliki's Cabinet held a meeting Tuesday and confirmed that "it is necessary to review the status of local and foreign private security companies working in Iraq according to what is suitable with Iraqi laws."

Order No. 17, a law issued by the Coalition Provisional Authority in Iraq before the Iraqis regained sovereignty in June 2004, gave the companies immunity from Iraqi prosecution.

Al-Dabbagh insisted the government was now sovereign and had the right to act against the contractors, "but we don't want to do so because we don't have the services which they are providing for the diplomats and for the American Embassy here in Iraq."

Hassan al-Rubaie, a member of the parliament's Security and Defense Committee, said an investigative committee has been formed and members would consider abolishing the immunity law.

"There are reports that they were subjected to fire but this does not give them the right to kill innocent civilians," he said.

The court’s presiding judge, Bo Vesterdorf, reading a summary of the decision on his final day in office, said, “The court finds the commission did not err in assessing the gravity and duration of the infringement and did not err in setting the amount of the fine. Since the abuse of a dominant position is confirmed by the court, the amount of the fine remains unchanged.”

“The court said the commission wins on virtually everything,” said Thomas Vinje, a partner at the law firm Clifford Chance and part of the legal team for the European Committee for Interoperable Systems, a coalition that includes Microsoft opponents like I.B.M. “The court has spoken. The commission was right.”

In a statement this morning, the European Union’s competition commissioner, Neelie Kroes, said: “The court has upheld a landmark commission decision to give consumers more choice in software markets. Microsoft must now comply fully with its legal obligations to desist from engaging in anti competitive conduct. The commission will do its utmost to ensure that Microsoft complies swiftly.”

Brad Smith, the general counsel for Microsoft, who was present for the reading, said the company would follow the ruling but did not say specifically whether the company would appeal it.

“It’s clearly very important to us as a company that we comply with our obligations under European law. We will study this decision carefully and if there are additional steps that we need to take, we will take them,” Mr. Smith said.

Robert Kramer, a vice president of public policy for CompTIA, a Microsoft ally that represents 3,000 technology companies, predicted the court’s ruling would have a chilling effect on investment both within the European Union and beyond.

“What this ruling will do is send a message to companies that if they establish a good market position with a successful product, they will be forced in Europe to essentially give up that product to their competitors,” Mr. Kramer said.

But Carlo Piana, a lawyer representing the Free Software Foundation Europe, hailed the court’s decision as a victory for small software developers around the world who may have lived in fear of Microsoft or other large platform operators. “This is an incredibly huge victory. The doors are kept open now for competition,” Mr. Piana said.

The decision followed a five-day hearing on the issues in April. Microsoft has indicated in the past that it would appeal any negative ruling to the European Court of Justice, the highest court in Europe, but Mr. Smith would not say today whether the company would take that step in the two months and 10 days it has to. An appeal by the company, a process likely to take at least two years, would focus only on whether the appellate court erred in procedure in reaching its decision, not on the facts in the case.

Microsoft has already been forced to pay nearly €1 billion in fines in the nine-year-old legal case, which has pitted the software maker based in Redmond, Wash., against the commission and a host of competitors, including I.B.M., Sun Microsystems, RealNetworks and Novell.

In its ruling, the 13-member panel of judges said Microsoft had violated European antitrust law by exploiting its near dominance in operating systems to shut out competitors like RealNetworks in digital media players and Sun Microsystems in workgroup exchange servers.

The ruling validated the pursuit of Microsoft by Mario Monti, former competition commissioner for the European Union, and his successor, Ms. Kroes. The case began in 1998 when Sun Microsystems filed a complaint over Microsoft’s refusal to disclose its confidential server protocols — computer code that competitors need to make their servers or desktop computers work with Microsoft products.

Microsoft has been repeatedly fined by the commission since the 2004 antitrust ruling for inadequately supplying the protocols. “I think this means it’s about time for Microsoft to comply,” Mr. Vinje said.

The commission later expanded its inquiry to include Microsoft’s practice of bundling its Windows Media Player into its dominant Windows operating system. After Microsoft began bundling its media player into Windows, it overtook the market leader, RealNetworks, and as of January it had a 50 percent share of the global market, according to the researcher Nielsen/NetRatings.

“There has obviously been a lot of work that has gone into our efforts to comply with the commission’s terms with respect to communications protocols,” Mr. Smith said in Luxembourg today. “We have made a lot of progress in that regard and yet we all have to acknowledge that there are some issues that do remain open.”

White House spokeswoman Dana Perino said the president hoped the US Senate, controlled by Bush's Democratic foes, would confirm Mukasey to replace the scandal-stained Alberto Gonzales before going into recess on October 8.

Gonzales, a close Bush confidant, left the post under a cloud, with Democratic and Republican critics alike charging that he lacked independence from the White House, was incompetent, hid the truth and may be guilty of perjury.

A former top aide to Gonzales revealed earlier this year that she improperly used political criteria in hiring decisions, and Democrats have been probing whether a mass purge of federal prosecutors was tied to political, not legal, considerations.

The nomination could have far-reaching implications for several pitched battles over Bush administration anti-terrorism policies, like warrantless spying on US citizens.

Democratic Majority Leader Harry Reid said Mukasey had "strong professional credentials a reputation for independence" and suggested the former judge "knows how to say no to the president when he oversteps the Constitution."

"But there should be no rush to judgment. The Senate Judiciary Committee must carefully examine Judge Mukasey's views on the complex legal challenges facing the nation," Reid said in a statement.

Democratic Senator Patrick Leahy, chairman of the Judiciary Committee that will take up the nomination before it goes to a vote, promised to review Mukasey's qualifications "a serious and deliberate fashion."

But in a potential hurdle to Mukasey, Leahy also warned that he would take into account White House "cooperation" on existing requests for information on issues like the mass firings and the warrantless surveillance program.

"The next attorney general needs to be someone who can begin the process of restoring the Department of Justice to its proper mission," Leahy, one of Gonzales's fiercest critics, said in a statement.

At the Rose Garden ceremony, which Gonzales did not attend, Mukasey thanked the embattled official for his "support and encouragement" but did not praise his record or his management of the Justice Department.

Mukasey said the department faced "vastly different" challenges from when he served there 35 years ago "but the principles that guide the department remain the same: To pursue justice by enforcing the law with unswerving fidelity to the Constitution."

Mukasey, 66, was appointed a federal district judge in New York under Republican former president Ronald Reagan and retired in 2006, returning to private practice.

He presided over several high-profile terrorism legal cases, including the trial of Omar Abdel-Rahman, the so-called "blind sheikh" who was convicted as the master of a 1993 attack on New York's World Trade Center towers.

Mukasey generally has been supportive of Bush administration policies in the war on terror, although he has at times ruled against the president.

He served as a district judge in the case of Jose Padilla, the US citizen accused by the Bush administration of being an enemy combatant who conspired to kill Americans overseas.

Mukasey upheld the Bush administration's right to detain Padilla indefinitely without charges -- a decision later reversed -- but ruled that he was entitled to a lawyer -- a position the administration argued against.

"That decision hardly makes Mukasey a wild-eyed civil libertarian," said Mark Agrast, a senior fellow with the left-of-center Center for American Progress think tank in Washington.

"But his insistence that the government give Padilla access to counsel was a rare act of principle at a time when few in Congress or the courts were willing to defy the administration," said Agrast.

The FCC last night, after a daylong struggle to reach consensus, took several actions of significance to cable operators and programmers.  First, the FCC adopted rules that it characterized as necessary to ensure that cable subscribers with analog televisions will be able to view local broadcast signals after the February 17, 2009 digital transition and a related further notice of rulemaking to address the economic impact of these rules on small cable operators.  Second, the agency also approved an order that extended for five years the ban on exclusive affiliation agreements involving satellite-delivered, vertically integrated programming and modified certain procedural rules for resolving program access complaints.  Third, the FCC announced a new rulemaking proceeding to consider further substantive and procedural changes to the program access rules, such as closing the so-called “terrestrial loophole” and barring broadcasters and cable programmers from “tying” two networks (i.e., forcing an MVPD to agree to carry one network in order to obtain the right to carry another network or broadcast station).   Although the Commission had been expected also to adopt an order extending to incumbent cable operators certain of the franchise reforms that were adopted for new entrants late last year, action on that item was postponed.

I. DUAL CARRIAGE

According to the FCC, analog-only cable subscribers constitute approximately 35 percent of the nation’s television homes (i.e., do not have a television or cable converter capable of receiving a digital signal).  Citing statutory provisions that were adopted prior to the development of digital television that require cable operators to provide subscribers with “viewable” local broadcast signals, the FCC adopted rules under which local broadcast signals are entitled to both analog and digital carriage unless the cable operator goes “all digital” prior to the transition deadline.  This “dual carriage” obligation will sunset in three years (February 18, 2012) unless the FCC acts affirmatively to extend it. 

In addition, the FCC provided potential relief to systems with limited channel capacity (552 MHz or less) by allowing them to request a waiver of the viewability requirement.  This action prompted a dissent from Commissioner Adelstein, who argued that limited capacity systems should have been automatically exempted from the rules.  The FCC also confirmed that cable systems must carry high definition (“HD”) broadcast signals in HD format and reaffirmed the current “material degradation” standard under which the picture quality of retransmitted broadcast signals must be equal to or better than the quality of non-broadcast video programming carried by the system.

The FCC’s action on dual carriage is generally regarded as a victory for the cable industry in that the proposal pushed by Chairman Martin would have established a permanent “dual carriage” obligation and would not have provided any relief for limited capacity systems.  Chairman Martin’s proposal also called for the adoption of a material degradation standard under which cable operators would have had to retransmit all of the “bits” in a broadcast digital signal – a requirement that would have prevented operators from using bandwidth-conserving compression technologies and could have easily been stretched into a multicast carriage obligation.

Finally, the FCC indicated that it would issue a further notice of rulemaking seeking comment on additional ways of minimizing the economic impact of the dual carriage requirement on small cable operators.  This further notice may also raise other questions.  It is not clear how long it will be before the staff releases the full text of the dual carriage order and further rulemaking, since changes were being made up until the last minute.

II. PROGRAM ACCESS

Section 628 of the Communications Act bars cable operators from entering into exclusive distribution agreements with vertically-integrated, satellite-delivered programming networks.  This prohibition originally was scheduled to “sunset” in 2002, but was extended for five years.  As was expected, the FCC yesterday decided to extend the exclusivity ban for another five years, finding that despite the growth of competition, cable operators continue to have the ability and incentive to withhold “essential” programming from other multi-channel video distributors. 

The FCC also adopted certain modifications to its program access complaint procedures, particularly with respect to the production of information relevant to the resolution of a complaint.  Although the FCC indicated that it would take steps to ensure that the confidentiality of sensitive business information is protected, Commissioners Adelstein and Copps expressed concern that this expanded “discovery” provision could go too far in requiring cable operators and programmers to provide complaining multichannel video providers with extensive information about other program affiliation agreements.

The new rulemaking that the FCC started in connection with the program access rules seeks comment on a pair of procedural issues: (1) whether the filing of a program access complaint in connection with proposed changes to an existing contract should trigger an automatic stay of the new provisions and (2) whether an arbitration-type step should be added to the complaint resolution process. 

Even more significantly, the notice of proposed rulemaking also addresses substantive issues, including whether the FCC can and should apply the program access rules to DBS, whether program access restrictions should apply to vertically-integrated services that are distributed terrestrially as well as to satellite-delivered services, whether the FCC should require programmers to deal with entities that provide service through a shared headend, and whether broadcasters and cable programmers should be required to offer their services on a “stand-alone” basis rather than forcing multichannel video distributors to purchase “undesired” programming in return for the right to carry desired programming.  As described, this latter proposal is directed at the wholesale distribution of programming and does not directly propose to require programmers to make their services available for retail distribution on an a la carte basis.

III. INCUMBENT CABLE OPERATOR FRANCHISE REFORM AND OTHER ISSUES.

Late last year, as part of the order adopting franchise reforms for new video entrants, the FCC commenced a proceeding to extend similar reforms to incumbent operators.  At the time, statements were made promising that action on this proceeding would be completed by September 2007.  And in fact, consideration of an order in the franchise reform proceeding originally was originally included on the agenda for yesterday’s meeting.  However, the franchise reform item was pulled from the agenda and, while it still could be adopted before the end of the month, its exact status is uncertain.  In addition, two other items of interest to cable are circulating among the Commissioners and could be decided in the near future.  One is an order that reportedly would deny a request by Comcast for a declaratory ruling that The America Channel is not a regional sports network for purposes of applying certain conditions imposed on Comcast and Time Warner as part of the FCC order approving the Adelphia transactions.  The other pending item is an order that would ban existing and future exclusive contracts between cable operators and the owners of multiple dwelling unit buildings.  This item raises several difficult legal issues (including whether the FCC has jurisdiction to void such contracts and whether it can only bar such contracts prospectively). 

http://fw-law.com/news.html

The Fire District charges Microsoft with engaging in "anticompetitive and monopolistic practices" and is seeking a jury trial. Attorneys for the Fire District are asking the court to open the case to all governing bodies in Arizona, giving it class action status.

The Fire District quietly filed the claim earlier this summer in Arizona state court in Maricopa County. Last week, Microsoft asked the federal U.S. District Court for Arizona to take over the case.

The Fire District is repeating many of the claims made against Microsoft by the Department of Justice and attorneys general on behalf of consumers in 19 states and the District of Columbia. The allegations center on charges that Microsoft used its monopoly position to overcharge for software applications such as word processors and spreadsheets. Under the settlements, Microsoft has agreed to issue millions of dollars worth of product vouchers to affected buyers.

Microsoft officials were not immediately available for comment.

Word of the action comes as Microsoft faces ongoing antitrust scrutiny in Europe. On Monday, Europe's second highest court rejected Microsoft's appeal of almost $1 billion in fines imposed on the company by trustbusters at the European Commission.