Microsoft Settles Iowa Antitrust Suit

Microsoft has settled a long-running Iowa class-action antitrust lawsuit for an undisclosed amount.

The case has already been to the Iowa Supreme Court three times, but today Microsoft agreed to settle an Iowa class action antitrust lawsuit against it for an undisclosed amount. Terms of the settlement could be released at a hearing in late April when the judge decides whether to accept the agreement, but for now all that has been disclosed is that Microsoft will contribute half of any unclaimed proceeds from the settlement to Iowa schools.

The case stems from the pricing of Microsoft operating systems and Office applications from May 1994 through June 2006—and, yes, the case even encompasses sales of MS-DOS. The Iowa plaintiffs, headed up by Des Moines lawyer Roxanne Conlin alleged that Microsoft abused its monopoly position in the marketplace to overcharge for its software products. Microsoft’s defense seemed to center on asserting its prices were, in fact, fair, and, even if they weren’t, no actual harm came to Iowa residents.

Previous settlement agreements in cases of this nature have often involved rebates or refunds to consumers, usually implemented through coupons and/or discounts on the purchase of new products. Given that Microsoft has already said it will donate half of unclaimed funds to Iowa schools, it seems safe to assume the agreement requires Microsoft to set aside a certain amount of money to resolve consumer claims, and that half of any unused portion of that fund will go to Iowa’s Department of Education. Microsoft’s associate general counsel Rich Wallis described the agreement this way: "One of the best aspects of resolving this case is that we can provide much needed resources to underprivileged schools." Rather a pity it took a class action lawsuit and years of litigation to elicit such a sentiment.