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Microsoft squares Minnesota class action

Lawyers clear the decks

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Microsoft is to pay out up to $241m to settle a class action suit in Minnesota. The software vendor admits to no wrongdoing, but the deal mean that it escapes its first-ever state trial over business practices.

The Minnesota lawyers will trouser up to $59.4m, the class members up to $174.5m in computer equipment vouchers, and for good measure, Microsoft is doling out $2.5m in cash and $2.5m in vouchers to Minnesota University's Institute of Technology, and $2.5m to the Minnesota Legal Aid Society.

Microsoft lawyers have had a busy week. Yesterday, they also settled an overcharging class action suit with Vermont, distributing up to $9.7m in computer equipment vouchers, joining deals struck earlier in the week with Massachusetts, South Dakota and Arizona.

It ain't over until it's over

On Wednesday, Microsoft won a crucial victory, with the US Court of Appeals rejecting an application by the state of Massachusetts and two US industry lobby groups to overturn the anti-trust settlement struck in 2002 with the Department of Justice. The decision means that the DoJ settlement is final - there is no recourse to another appeal.

In April, Microsoft took Sun out of the anti-trust loop in a $2bn-ish deal. This leaves Microsoft lawyers with only two big cases to fight: the appeals process against the EC's anti-trust sanctions, and the California action with Real Networks, which is sueing the company for $1bn

Yesterday, it emerged that Microsoft had paid the EC fine - €497m - into an escrow account. Last weekend the EC suspended the more meaningful penalty - what's half a billion euros, after all, to Microsoft? - forcing the company to decouple Media Player from Windows. A lasting court-proof resolution is expected in, oh, three years, or so.

This slows down the case nicely for Microsoft. Its flurry of recent activity shows that it wants to clear the decks of legal cases, but the EC ruling strikes too deeply into the heart of Microsoft for it to bow down without a fight. The lengthy appeal should ensure that decoupling is defanged.

Real time

It doesn't look like Real is going away any time soon, either. Here is a statement the company sent us, following Microsoft's appeals win:

"The U.S. courts and the European Commission have each concluded that Microsoft's unlawful abuse of its operating system monopoly has restricted competition, stifled innovation and limited consumer choice. Unfortunately, the settlement approved today by the court has done little to restore competition in the browser and operating system markets.

As recognized by the European Commission, Microsoft has used the same unlawful tactics to limit competition, innovation and consumer choice in other critical technologies, including the growing field of digital media. We will continue to vigorously pursue our case in the U.S. district court in California to obtain injunctive relief sufficient to stop Microsoft's predatory conduct and secure compensation for the harm Microsoft has caused. In the meantime, we will continue to compete against Microsoft's products by innovating, diversifying our business and giving consumers and businesses real choices in digital media." ®

Related stories

US court waves through Microsoft DoJ settlement
EC suspends Microsoft sanctions
Sun settles with MS for $2bn (ish)
Real sues Microsoft, seeks $1bn damages
Why Real sued Microsoft

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