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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND IN RE MICROSOFT CORP. ANTITRUST LITIGATION This document relates to: STATE OF WEST VIRGINIA, ex rel. DARRELL V. McGRAW, JR., ATTORNEY GENERAL, v. MICROSOFT CORPORATION * * MDL 1332 * * * * * * * * Civil No. JFM-02-2091 * * *****

MEMORANDUM Plaintiff, State of West Virginia ex rel Darrell V. McGraw, Jr., Attorney General ("the State" or "West Virginia"), moves to remand this action to the Circuit Court of Boone County, West Virginia. The motion will be granted. The motion for attorneys' fees and costs will, however, be denied. I. On May 18, 1998, West Virginia filed an action against Microsoft in the District of Columbia alleging violations of federal antitrust law, the West Virginia Antitrust Act, and the West Virginia Consumer Credit and Protection Act. The district court subsequently held a bench trial and entered judgment. See United States v. Microsoft Corp., 97 F. Supp. 2d 59 (D.D.C. 2000); United States v. Microsoft Corp., 87 F. Supp. 2d 30 (D.D.C. 2000); United States v. Microsoft Corp., 84 F. Supp. 2d 9 (D.D.C. 1999). On appeal, the D.C. Circuit Court of Appeals affirmed in part, reversed in part, and vacated the district court's judgment. United States v. Microsoft Corp., 253 F.3d 34 (D.C. Cir.)

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(en banc), cert. denied, 122 S. Ct. 350 (2001). Following remand, the United States and nine States agreed to a settlement of their claims against Microsoft and proposed a Revised Proposed Final Judgment ("RPFJ") to the district court. Nine other States, including West Virginia, and the District of Columbia opposed the settlement and sought more extensive remedies. On November 1, 2002, Judge Kollar-Kotelly of the district court issued several rulings. Judge Kollar-Kotelly conditionally approved the RPFJ. United States v. Microsoft Corp., __ F. Supp. 2d __, 2002 WL 31439450 (D.D.C. 2002). Additionally, Judge Kollar-Kotelly denied the requests of West Virginia and the other so-called "dissenting" States for more extensive remedies than those sought in the RPFJ. New York v. Microsoft Corp., 224 F. Supp. 2d 76 (D.D.C. 2002). On December 3, 2001, West Virginia filed this action in the Circuit Court of Boone County, West Virginia, alleging only state law claims that Microsoft violated West Virginia's Antitrust Act, West Virginia's Consumer Credit and Protection Act, and West Virginia's Unfair Practices Act. After

Microsoft removed the action to the Southern District of West Virginia, the State filed this motion to remand. The motion was pending when the action was transferred to this court on June 17, 2002 by the Judicial Panel on Multidistrict Litigation ("MDL"). II. In its motion, the State argues that remand is appropriate because none of the claims it has asserted arise under federal law. Microsoft, in response, points to the enigmatic "footnote two" in Federated Dep't Stores, Inc v. Moitie, 452 U.S. 394, 397 n.2 (1981), as the basis for removal.

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Microsoft's removal to federal court is premised on federal question jurisdiction. "The wellpleaded complaint rule requires that federal question jurisdiction not exist unless a federal question appears on the face of a plaintiff's properly pleaded complaint." Columbia Gas Transmission Corp. v. Drain, 237 F.3d 366, 370 (4th Cir. 2001) (citing Merrell Dow Pharm., Inc. v. Thompson, 478 U.S. 804, 808 (1986)). There is, however, an exception to the well-pleaded complaint rule known as artful pleading. "Under the doctrine of `artful pleading,' a court is permitted to look behind a complaint to determine whether a plaintiff is attempting to conceal the federal nature of his claim by fraud or obfuscation." In re Wireless Tel. Radio Frequency Emissions Prod. Liab. Litigation, 216 F. Supp. 2d 474, 492 (D. Md. 2002) (citation omitted). Artful pleading is best described as "the manner in which some plaintiffs . . . manage to plead claims that are actually federal . . . under state law." Id. Two categories of artful pleading cases are firmly established: cases involving complete preemption of state law by federal law, see, e.g., Rivet v. Regions Bank of Louisiana, 522 U.S. 470, 475 (1998), and cases involving substantial questions of federal law. See, e.g., Merrell Dow, 478 U.S. at 807 n.2; Franchise Tax Board v. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1, 27-28 (1983). The parties agree that neither of these categories applies in this case. Instead, Microsoft attempts to rely on a third potential category of artful pleading cases: those falling within Moitie's footnote two. Moitie began as an antitrust suit brought by the United States against various department stores in which it was alleged that the stores had violated section 1 of the Sherman Act, 15 U.S.C.

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