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Microsoft agrees to $1.1 billion class settlement
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January 11, 2003 (PC World) -- Hundreds of thousands of California consumers and schoolchildren could benefit from an estimated $1.1 billion settlement by Microsoft Corp. in a class-action antitrust suit announced late yesterday.
The deal calls for Microsoft to offer vouchers, ranging from $4 to $29, to California customers who purchased Microsoft software between Feb. 18, 1995, and Dec. 15, 2001. Two-thirds of the amount not claimed by individuals will be donated to 4,700 of California's neediest schools, according to Brad Smith, Microsoft general counsel, and Eugene Crew, lead counsel for Townsend and Townsend and Crew LLP, the San Francisco law firm that brought the suit nearly four years ago.
The vouchers vary in amount depending on which Microsoft product the customer purchased. Consumers and businesses can redeem the vouchers for rebates on the purchase of additional technology products, and not just Microsoft products.
Likewise, the schools can use their share of the settlement toward the purchase of any technology products and professional training for teachers. Half of that award, through the California State Department of Education, will be in Microsoft software -- including Macintosh software often used by schools -- and half in vouchers that can be used for the purchase of various products. Unlike under a previous proposal, the schools may even purchase equipment produced by Microsoft competitors.
In fact, an earlier proposed settlement in a consolidation of similar class-action antitrust cases stalled almost exactly a year ago when a U.S. District Court judge in Baltimore rejected the deal after some competitors and consumers complained. That abandoned deal would have let Microsoft settle the suit by donating its own software to schools and establishing a charitable foundation to distribute technology. It also would have prevented this deal, the California attorneys said.
Yesterday's settlement was structured specifically to address some of the objections raised a year ago, said Tom Burt, Microsoft's deputy general counsel for law and corporate affairs, at a hastily called news conference. "We believe this settlement to be platform-neutral, because the award can be used for non-Microsoft operating system purchases," Burt said.
"This [agreement] is a world of difference," said plaintiff attorney Crew, who described the firm as "ecstatic" about the settlement.
Crew said he expects most of the claims to come from businesses, which keep detailed records of equipment purchases, but he added that the claim process should be simple enough to encourage consumers. No documentation will be required for small consumer claims, he said.
"We're going to distribute claim forms everywhere," Crew said. Information and claim forms will become available through electronic notices, including the Townsend Web site.
Reprinted with permission from
For more PC news, visit PCWorld.com.Story copyright 2006 PC World Communications. All rights reserved.
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