The agreement, which is yet to be approved by the California
Superior Court, ends an antitrust, class action lawsuit filed in
1999 by Californian consumers, alleging that Microsoft overcharged
by $40 for every copy of Windows 95 and 98 and abused its dominant
position in the market for PC operating systems.
The case was scheduled for trial in San Francisco next month.
Similar lawsuits against Microsoft are still pending in 16 states
and the District of Columbia.
According to Microsoft and the consumers' attorneys, the
settlement benefits Californian residents who bought Microsoft
Windows operating system, spreadsheet or word processing software
between 18th February 1995 and 15th December 2001.
These consumers will have the right to apply for vouchers worth
between $5 and $29 to buy desktops, laptops and software, including
non-Microsoft products. The amount of the refund will be set per
software licence.
The maximum value of the settlement is $1.1 billion, however
Microsoft will only have to pay this sum if all vouchers are
claimed. Two-thirds of any unclaimed proceeds will be donated to
Californian public schools in the form of Microsoft "educational
and productivity software", as well as vouchers for any
manufacturer's hardware and software.
Microsoft will keep the remaining third of any unclaimed
proceeds. The company is also liable for the consumers' legal fees,
but the sum has to be set by the court.
Microsoft has, according to media reports, agreed to notify all
Californian computer users listed in its database about the
vouchers by post or e-mail, and to create a web site to provide
claim forms. The offer will also be publicised in Californian
newspapers.
Californian state laws allow software end-users, such as consumers
and businesses, to file suits over unfair competition. In most US
states, however, only direct buyers of software licences, such as
computer manufacturers, have the right to file such lawsuits.
