Despite a last-ditch settlement attempt by its CEO, Microsoft Corp. once again finds itself facing protracted litigation and possibly stiff sanctions—this time in Europe. Rivals hailed the development as a victory for software interoperability and competition.

CEO Steve Ballmer dropped plans to speak at Microsoft's Management Summit in Las Vegas last week to fly suddenly to Brussels, Belgium, to try to negotiate a settlement with the European Commission. But the effort failed, and this week Microsoft faces a final order from the EC, which could include requirements for the company to unbundle middleware from Windows, disclose greater interface information and abide by market conduct rules for future products.

The ruling will be the result of more than five years of investigating Microsoft's use of its power in the operating system market to gain advantage in related software markets.

Ballmer, who had canceled a number of other domestic appointments last week in addition to his Management Summit keynote speech, was hopeful that despite the failed negotiations to date, Microsoft could settle the case "at a later stage," sources close to the matter said.

However, European Union member states voted unanimously last week in favor of the commission's proposed order issued last August, indicating that, unlike the United States, they won't accept a Microsoft-crafted remedy.

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