California settles Microsoft case
By Rachel Konrad
Associated Press
SAN FRANCISCO — California consumers settled a class-action suit against Microsoft Corp. for $1.1 billion yesterday, ending a contentious legal battle that accused the software giant of violating the state's antitrust and unfair-competition laws.
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Under the agreement made public last night, proceeds of the settlement will be distributed to members of the class in the form of vouchers redeemable for any laptop, desktop or tablet computer hardware or software. The settlement could also provide money and technology to the state's poorest schools.
California and other states have sued software maker Microsoft alleging antitrust violations. The dismissal of a suit in Hawai'i is being appealed.
"This is one of the largest settlements ever reached under the antitrust or unfair-competition laws of California," plaintiffs' lead counsel Eugene Crew said.
Lawyers for both sides said the deal, which must be approved by a judge in San Francisco, could benefit more than 13 million consumers and 3 million children in 4,700 schools.
A Hawai'i class-action lawsuit against Microsoft was earlier dismissed by a trial court and has been on appeal to the Hawai'i Supreme Court for the past year, said attorney Thomas Grande. Grande filed the suit in March 2000, seeking what he estimated to be as much as $6 million in damages, which could triple under antitrust laws.
The California settlement requires Microsoft to provide $1.1 billion in vouchers, equivalent to 28.4 percent of all the money that California consumers paid for Microsoft products from February 1995 to December 2001. Two-thirds of the unclaimed settlement amount will go to California's poorest schools in the form of software, hardware and money for technology programs, under the terms of the agreement.
But critics immediately blasted the settlement, saying California "sold out" to the software giant in part because of a $34.6 billion budget deficit and the continuing economic downturn.
"This seems to be a country where you can buy justice pretty easily these days, especially in these hard-hit economic times when the price of justice goes down," said John Perry Barlow, co-founder and vice chairman of the Electronic Frontier Foundation.
"If there's ever been a company that abused anti-trust law to the detriment of consumers and the economy, it is Microsoft."
