$1.1 billion Microsoft antitrust settlement to be distributed
By Anna Molin, Bay City News Service
July 26, 2006
California businesses and consumers who two years ago settled
a $1.1 billion antitrust class action lawsuit against Microsoft
will finally receive their shares starting next month, Townsend
and Townsend and Crew LLP, the law firm representing the plaintiffs,
Hundreds of millions of dollars await some 720,000 Californians
including more than 4,500 businesses that bought overpriced Microsoft
software between 1995 and 2001 and filed claims before January
2005. The bulk of the $1.1 billion, nearly 80 percent, will go
to businesses that purchased mass quantities of Microsoft computers
with Windows operating systems and other Microsoft applications
Many of those businesses have, however, agreed to donate two-thirds
of their settlements to California public schools.
Townsend and Townsend and Crew LLP partner Richard Grossman said
today schools could receive between $400 million to $600 million
from the settlement "at a time when they definitely need
The vouchers, which range from less than $100 to hundreds of
thousands of dollars, can be redeemed for cash when buying computer
hardware and software products during the next four years.
"We filed this case in 1999 because we saw an opportunity
to use our expertise in technology and antitrust law to obtain
justice for the millions of California consumers and businesses
that were overcharged for their software as a result of Microsoft's
illegal monopoly," Grossman said.
"We are delighted that our seven-year legal battle is finally
paying off for California's businesses, consumers and schools."
Proceeds from the settlement were withheld during years of appeals
battles involving a single class member who declined to make a
claim for his share but objected to the donation of any portion
of his unclaimed benefits to the public schools, according to
the law firm.
After having his appeal rejected by both the state Court of Appeals
and the state Supreme Court, the class member failed to meet the
appeal deadline to the U.S. Supreme Court last week, which cleared
the way for the distribution of settlement proceeds.
Individuals nationwide began suing the Redmond, Wash.-based,
computer software giant in 1999 after a U.S. District Court judge
in Washington ruled that Microsoft's monopoly hurt consumers and
stifled competition in an antitrust lawsuit filed by the U.S.
Justice Department and 20 other states, including California.
Local governments, including the Bay Area counties of Santa Clara,
San Francisco, San Mateo and Contra Costa, also jumped on the
class action bandwagon in 2004 hoping to recover financial compensation
akin to the $2 billion awarded to Sun Microsystems earlier that
The state and local governments settled for $70 million last
summer and could expect to see money coming in early 2007 unless
the case is appealed, said Grossman, whose firm handled that suit
A Microsoft spokesperson could not immediately be reached for
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