Microsoft moves to settle private suits

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After finally reaching a deal in its antitrust battle against the U.S. Department of Justice and nine states earlier this month, Microsoft Corp. is close to settling a host of private suits still nipping at the software titan, a representative of the law firm that proposed the settlement confirmed Tuesday.

According to a representative for Washington D.C.-based Cohen, Milstein, Hausfeld and Toll P.L.L.C., Microsoft was hammering out a deal whereby it would supply computers and software to more than 14,000 of the U.S.'s poorest schools over the next five years in order to settle over 100 of the private suits that remain against it.

Details of the deal surfaced Tuesday morning in a report by the Wall Street Journal.

Under the deal, Microsoft would provide software valued at approximately US$900 million to schools where at least 70 percent of the students qualify for the federal free or reduced lunch programs, the representative for the law firm confirmed. Microsoft would also have to supply some 200,000 reconditioned PCs and laptops, the representative added. In addition, the software maker would be responsible for providing $90 million in teacher training and $38 million in technical support. An independent foundation would also be set up to ensure that objectives of the deal were met, with Microsoft shelling out another $250 million to set up the foundation, as well as seeking $200 million in matching funds.

Additionally, Microsoft would contribute another $160 million to help support a program that teaches students how to repair and service computers and networks.

Plaintiffs in the private antitrust lawsuits claim that Microsoft used a desktop operating system monopoly to force users to pay inflated prices for the company's software. The proposed deal would settle a majority of the private antitrust suits, leaving just those centered around the company's new Windows XP operating system still up in the air, the representative said.

A conservative estimate pegs Microsoft's cost for the agreement at $1.1 billion, the representative added. The deal is due to be approved by U.S. District Judge J. Frederick Motz in Baltimore, who is overseeing the class action suits. A hearing on the matter is scheduled for next Tuesday.

The school-software proposal was introduced by the plaintiffs' lead attorney, Michael D. Hausfeld, when it was determined that the sheer number of individual members of the plaintiffs' cases -- at least 65 million -- could reduce a successful settlement bid to some $10 a piece.

No one at Microsoft was immediately available for comment Tuesday morning.

This story, "Microsoft moves to settle private suits" was originally published by PCWorld.

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