Judge rejects proposed Microsoft settlement offer
A US federal judge has rejected Microsoft’s offer to donate computers and software to schools to settle dozens of private anti-trust lawsuits accusing it of overcharging for its products.
US District Judge Frederick Motz said the settlement is ‘‘critically underfunded’’ and could give Microsoft a powerful boost against its rival Apple Computer by helping it establish a bigger foothold in schools.
Microsoft had offered to give software, 200,000 refurbished computers and other resources the company valued at 1 billion dollars (€1.6bn) to the poorest public schools in the US.
But Apple argued in December that the agreement would give Microsoft an unfair advantage by encouraging schools to acquire more Microsoft products.
‘‘The agreement raises legitimate questions since it appears to provide a means for flooding a part of the kindergarten through high school market in which Microsoft has not traditionally been the strongest player (particularly in relation to Apple) with Microsoft software and refurbished PCs,’’ the judge said yesterday.
The Baltimore judge also said the widely divergent estimates of the value of the claims being settled prevented him from granting approval.
Microsoft had argued that it could have as little as 200 million dollars (€325m) in liability, while some economists for the plaintiffs estimated the company’s liability to be more than 18 billion dollars (€29bn).
In dozens of private class-action lawsuits, Microsoft is accused of abusing its monopoly power and overcharging people for Windows, Office and other software. The lawsuits are separate from anti-trust suits brought by states and the federal government.
Microsoft lawyer David Tulchin said it is too early to know if the parties could negotiate another settlement that would meet the judge’s standards.
‘‘We are willing to litigate, and we have done well so far,’’ Mr Tulchin said.
Cincinnati lawyer Stan Chesley, a national co-chairman for the plaintiffs, said he was disappointed with the judge’s order, but that his clients still hoped to reach an agreement.
‘‘We will work diligently with Microsoft and fix the settlement before we (would) go to litigation,’’ he said.
