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EDITIONS
 Saturday, 11 January, 2003, 15:05 GMT
Microsoft agrees $1.1bn legal deal
Microsoft headquarters in Redmond
Microsoft still faces other legal fights
The American software giant, Microsoft, has agreed to give away vouchers worth more than $1bn (622m) to settle private lawsuits filed by customers in California.

We feel very good that we've put these cases behind us

Microsoft lawyer
Some 13 million Californian businesses and individuals will be offered the vouchers to purchase computer equipment and software including, if they want, non-Microsoft products.

The offer must still be approved by the judge hearing the case.

It involved accusations that Microsoft overcharged customers in California and abused its dominant market position.

Lawyers say the agreement could also benefit 3 million children in thousands of California schools.

'We feel good'

Microsoft has been dogged by lawsuits accusing it of abusing its dominant position in the world's computer business. Many cases are still pending.

Bill Gates
Bill Gates' lawyers have welcomed the deal

But Microsoft lawyer Brad Smith said the California deal was highly significant.

"California represented by far the largest number of remaining lawsuits and by far the largest number of consumers affected.

"We feel very good that we've put these cases behind us in California and we feel confident about resolving other cases as well," Mr Smith said.

Education benefits

The case was due to open in court in February.

The class-action lawsuit was filed in 1999. It covers California consumers who bought any of the following Microsoft products over a six-year period:

  • Windows operating system
  • Spreadsheet system
  • Word processing software
  • Productivity suite

Microsoft said the vouchers affected consumers receive will be valid for "any manufacturer's desktop, laptop and tablet computers, any software used with those computer products and specified peripheral devices for use with computers".

Local schools will benefit because they will get two-thirds of any of the settlement that is unclaimed.

"It is a tremendous result for California's businesses and consumers and will also benefit our schools at a time when that help is desperately needed," lawyer Richard Grossman said.

'Buying justice'

But not everyone is happy.

John Perry Barlow of the lobby group the Electronic Frontier Foundation, which campaigns to protect people's computer rights, believes Microsoft has got off lightly.

"This seems to be a country where you can buy justice pretty easily these days," he said, the Associated Press news agency reports.

In a separate development, a judge in the state of Maryland has refused a request by Microsoft to dismiss private antitrust claims filed against it by three rival software companies. He said there was sufficient evidence for the cases to go forward.

Last November a judge in Washington approved a settlement Microsoft struck with the US Government. That settlement was brought in response for demands that the software giant be broken up.

A number of US states have appealed against that decision.

  WATCH/LISTEN
  ON THIS STORY
  The BBC's Irene Chang-Bearelly
"The offer by Microsoft is being billed as one of the largest settlements of its kind"

The settlement

Appeal court ruling

Appeal hearing

Analysis
See also:

02 Nov 02 | Business
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