Federal Judge Is Ordered To Step Aside on I.B.M.

By Mary B. W. Tabor
The New York Times

January 18, 1995

In an unusual rebuke to another jurist, a Federal appeals court yesterday ordered the Federal district judge who has overseen the Justice Department's antitrust settlement with I.B.M. for almost 40 years to remove himself from the case, saying he does not appear impartial.

The ruling, which orders the case reassigned, ends a long and bitter legal feud in which Judge David N. Edelstein has repeatedly rejected the demands of the International Business Machines Corporation that he step aside. I.B.M. has been asking the judge to lift a 1956 consent decree that restricted the company's operations, saying the settlement was obsolete. But almost from the beginning, the company has contended that Judge Edelstein has treated it unfairly.

Chief Judge Jon O. Newman of the United States Court of Appeals for the Second Circuit wrote that he and the other judges on the panel assumed that "the judge's subjective disposition is one of impartiality concerning both I.B.M. and the issue of terminating the decree" and described Judge Edelstein as "one of the ablest and most experienced judges" in the Southern District of New York.

But, Judge Newman wrote, "we think it manifestly clear that a reasonable observer would question the judge's impartiality on the pending issue."

In the unanimous ruling, Judge Newman noted that, among other things, Judge Edelstein had conducted an inquiry into why the Justice Department wanted to dismiss its case and had also refused to approve several orders, jointly proposed by I.B.M. and the Justice Department, allowing the parties to throw out billions of pages of documents that had accumulated during the litigation.

Historically, Federal appeals courts have been reluctant to sustain requests that judges remove themselves from cases, on the ground that to do so undermines the Federal judiciary and encourages litigants to "shop" for judges whom they believe would be more favorable.

But yesterday, Judge Newman said the case should be reassigned randomly.

The case involves an antitrust complaint by the Justice Department against I.B.M. in 1952, when the company's main business was punch-card technology rather than computers. In 1956, Judge Edelstein signed a consent order to which the Justice Department and I.B.M. agreed, under which the company would modify some business practices.

I.B.M. says it wants the consent decree lifted on the ground that advances in computer technology had made it obsolete and that it was adversely affecting the company's ability to compete effectively in worldwide computer markets.

Last summer, Judge Edelstein responded to I.B.M.'s continued efforts to have him removed with an order that called I.B.M.'s accusations that he was unfair "ludicrous."

A law clerk for Judge Edelstein said last night that the judge had no comment on yesterday's ruling. Justice Department officials also declined to comment on whether they would seek to have the case heard by the United States Supreme Court, saying they had not yet seen the opinion.

Thomas D. Barr, a lawyer for I.B.M., said he had no comment on the ruling.

"It's important to I.B.M. to get the consent decree terminated," he said. "Now we will undertake to get that done as quickly as we can with a new judge."

Scott Brooks, a spokesman for I.B.M., declined to comment.

Judge Edelstein, who is 84, has been on the bench for 44 years, longer than any other Federal judge in the country.