The prospect of a settlement between the US federal government and Microsoft in the antitrust case against the software giant grew stronger last week, as US District Judge Thomas Penfield Jackson appointed a mediator to the case.

One day after a meeting with Microsoft and US Department of Justice (DOJ) officials, Jackson appointed Richard Posner, the chief judge of the 7th Circuit US Court of Appeals in Chicago, to oversee negotiations. Posner will determine when the two sides will sit down together.

"We look forward to working with Judge Posner and maybe reach a fair and reasonable solution," Microsoft spokesman Jim Cullinan said. "We think the naming of a mediator is potentially a positive step in resolving this case."

In a harshly worded findings of fact issued two weeks ago, Jackson sided with virtually all of the DOJ's charges against the company. Jackson said he believed Microsoft was a monopoly that ruthlessly quashed competitors and limited consumer choice.

The ruling, while not a verdict, spelled out Jackson's reading of the evidence presented in the 76-day trial. Many legal and technical industry analysts predicted that Microsoft would seek to return to the negotiating table after it became clear Jackson believed the DOJ had proved its case.

US government officials are mulling remedies in the case, such as breaking up the company, forcing it to make its Windows operating system source code public, or imposing strict regulations on its business practices. Observers thought that such harsh potential punishments would compel Microsoft officials to once again seek an out-of-court settlement. Barring a settlement, Microsoft most assuredly will appeal a negative verdict.

Jackson also scheduled closing oral arguments in the case for February 22.

Posner, who graduated Harvard Law School in 1962, was appointed to the Seventh Circuit in 1981. He was appointed chief judge 12 years later.