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Microsoft's $250 Million Check To Calif. Remains Mostly Untouched

Oct 28, 2008 (01:10 PM EDT)

Read the Original Article at http://www.informationweek.com/news/showArticle.jhtml?articleID=211601153


Microsoft wants to give away several hundred million dollars in settlement awards to school districts in California, but so far most of the funds haven't been touched. The unused funds are part of a $1.1 billion class-action settlement that Microsoft reached a few years ago.

According to a report in the Los Angeles Times this week, most of a $250 million grant awarded in connection with the settlement has not been used. As one example, the Los Angeles Unified School District was awarded vouchers worth $34 million, but less than $6 million of that has been used, the paper's report said.

The grants stem from a class action lawsuit filed in 1999, claiming that Microsoft overcharged for software bought between February 1995 and December 2001.

Several other states also brought class action suits against Microsoft on similar complaints and most of those were settled. The terms varied from state-to-state, according to the laws in the different states.

The attorneys who won the class action case were awarded fees of $101 million in addition to another $11.5 million in expenses, according to media reports at the time in 2004. The attorneys had sought $258 million in fees, but that request was whittled down by a California Superior Court judge.

The award money won't necessarily be lost, however. Richard Grossman, a partner with Townsend and Townsend and Crew in San Francisco and co-lead attorney for the plaintiffs told the Los Angeles Times that the state's schools will likely receive more from the settlement later. The schools have a few more years to use the awards from the settlement.

Originally, the settlement with individual consumers who bought Microsoft gear called for the consumers to receive rebates ranging from $5 to $29, but relatively few individual consumers took advantage of the rebates.

While awards for individual consumers have been miniscule, several large California businesses with thousands of Microsoft software users filed to receive a portion of the settlement awards by a January 2005 deadline.