Microsoft Corp will pay up to US$1.1 billion to settle lawsuits alleging the world's biggest software maker violated California antitrust and unfair competition laws.
Purchasers of Microsoft products will receive vouchers good for buying any manufacturer's personal computer and software that runs on it, Microsoft General Counsel Brad Smith said. Two-thirds of unclaimed funds will go to California schools in low-income areas and the rest will revert to Microsoft.
Microsoft, which faces similar lawsuits in 16 states and the District of Columbia, is trying to put its legal entanglements behind it after a federal appeals court in 2001 found the company illegally protected its Windows operating system monopoly. The ruling is binding in many of the cases, making it easier for plaintiffs to win their case, legal analysts have said.
"This agreement marks a significant step forward in our work to resolve our antitrust legal issues," Smith said on a conference call.
"[Friday's] settlement resolves the cases that represented by a very substantial margin the largest group of lawsuits."
Microsoft is still calculating how much of the US$1.1 billion it ultimately will pay, Smith said. The cost will depend on the number of people who file eligible claims and other factors.
The company set aside US$660 million to cover antitrust lawsuits and plans to say whether it expects to adjust that figure on a Jan. 16 conference call previously scheduled to discuss earnings.
People who bought Microsoft operating systems or programs for word processing, spreadsheets for use in California between Feb.
18, 1995 and Dec. 15, 2001 are eligible for a voucher, Smith said.
Vouchers will range from US$5 to US$29 depending on the type of product consumers purchased.
Eugene Crew, the lawyer representing the plaintiffs, said about 13 million consumers and businesses had joined the suit.
"Without a doubt this is the largest settlement of any case under California antitrust law," Crew said in an interview.
Microsoft was dealt a setback in the case in October when a California judge ruled that the US appellate court's June 2001 ruling could be used in the consumers' suit.
Microsoft had sought to keep the findings from being given to the jury in the California case. Microsoft agreed to settle the US case after the appeals court ruling.
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