Microsoft Settles Iowa Class-Action Lawsuit

Microsoft on Wednesday said it has settled an Iowa class-action lawsuit accusing the company of overcharging consumers and businesses for its products.

Terms of the settlement were not disclosed pending approval from the state court trying the antitrust case. Approval is expected in April, Microsoft and plaintiff's lead attorney Roxanne Conlin said in a joint statement.

Under the agreement, Microsoft would provide half of any unclaimed proceeds to the Iowa Department of Education to help bridge the digital divide in public schools through the purchase of computer hardware and software.

"One of the best aspects of resolving this case is that we can provide much needed resources to underprivileged schools," Rich Wallis, associate general counsel for Microsoft, said in the statement.

Plaintiff's attorneys appeared pleased with the deal. "We are confident that the settlement is in the best interests of all members of the class and we are deeply grateful for the quality and fairness of the judicial process in Iowa," Conlin said.

If approved by the court, the settlement would end the seven-year case that went to the Iowa Supreme Court three times. The class-action suit claimed Microsoft overcharged consumers and businesses as much as $453 million over a 12-year period because of a lack of competition. The antitrust case was unique in that most federal and state antitrust suits against Microsoft had either been settled or dismissed. Documents filed in the case were sometimes embarrassing to Microsoft.

Microsoft products covered in the agreement include MS-DOS, Windows 95, Windows 98, Windows 98 Second Edition, Windows Millennium Edition, Windows for Workgroups, Windows NT Workstation, Windows 2000, and Windows XP, as well as Word, Excel and Office versions designed for those operating systems. To be eligible for compensation, a person or business would have had to have bought one or more of those products between May 18, 1994 and June 30, 2006.