Describing Microsoft's proposed settlement with the US government and 18 states as "ineffectual," Massachusetts Attorney General Thomas F. Reilly said this weekend that his state won't approve the deal. The announcement came days before the Tuesday deadline, and Reilly's refusal to sign off on the settlement is an early sign that the fledgling deal might not be the end of Microsoft's legal problems.

"There's no question in my mind that Microsoft will use this agreement to crush competition, and they would have the imprimatur of the US government to do it," Reilly said. "Massachusetts will not sign the proposed agreement between Microsoft and the DOJ without major changes. I don't expect those will happen \[before Tuesday's hearing\]."

Reilly correctly noted that the settlement is "riddled with exceptions" that give Microsoft crucial wiggle room in future debates about its behavior. "The problems that we have with this agreement are serious," he told the Boston Globe this weekend. "I don't believe it's good for competition. I don't believe it's good for consumers."

Barring any last-minute concessions from Microsoft, which Reilly says are unlikely, Massachusetts and any other states that refuse to sign off on the settlement will proceed with further litigation against the company so that they can seek additional remedies in court. Such action could potentially lead to lengthy court proceedings and more appeals to both the US District Court of Appeals and the US Supreme Court.

"Microsoft is going to violate this agreement," Reilly said. "That's their nature. \[If anyone gets\] in their way, they crush them, or they buy them."