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Microsoft Settles Iowa Antitrust Case 198

ForestRangerBob writes "Comes v. Microsoft is over after Microsoft agreed to a settlement. The class action lawsuit alleged that Iowa consumers had been overcharged for Microsoft products for a decade owing to Microsoft's monopoly of the market. Predictably, the lawyers are about to get a big payday and 'the software giant will certainly be on the hook for millions of dollars, some of which may end up helping Iowa school kids. Average consumers will probably end up with a few bucks or a coupon for a free operating system upgrade, but the real winners will no doubt be the lawyers — the team prosecuting the case has already earned $60 million in legal fees from a 2004 case in Minnesota that charged Microsoft with similar offenses.'"
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Microsoft Settles Iowa Antitrust Case

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  • by whoever57 ( 658626 ) on Wednesday February 14, 2007 @03:12PM (#18014958) Journal
    When I first tried to read the comments, I got /.'s familiar "nothing to see here..." message, which also describes the site that hosted the documents from the Iowa case. Going to the site hosting the documents [] now results in a login request.
    • I see that google caches [] of some of it are still available. I couldn't find anything at though on the WBM [].

      A quick glance at Groklaw shows more links to the Iowa site then copies of the docs. What a shame the public record gets so quickly covered up once the money starts changing hands.
    • Re: (Score:2, Informative)

      by Anonymous Coward
      I used wget to take a mirrored copy of the entire site about two weeks ago so some of it could be available then. If someone could advise me regarding the legal side of making it public, then I will make it public. Please send advice to
    • I am willing to host the documents and bear any legal risk (of which I do not believe there is any). Contact me through the email here.
  • by Dunbal ( 464142 ) on Wednesday February 14, 2007 @03:13PM (#18014962)
    Average consumers will probably end up with a few bucks or a coupon for a free operating system upgrade

          No, that's worth WAAAAAY too much. The consumers will get a free Microsft Vista (tm) mousepad.
    • Re: (Score:2, Funny)

      by Joebert ( 946227 )
      Oh, they'll get a free Vista upgrade alright...
    • by schwaang ( 667808 ) on Wednesday February 14, 2007 @03:49PM (#18015372)
      Average consumers won't even hear about this. Just like in the California settlement, I don't know anyone who actually filed. Two people I know started the process and were intimidated by the paperwork because they didn't have receipts for computers they bought years before and were afraid of being audited. (They both had legitimately purchased copies of eligible MS products.)

      Hopefully the money that doesn't go to the lawyers will at least go to schools or something.
    • I'm not ready to agree with that just yet.

      There is a similar lawsuit in Wisconsin [] and the vouchers, while not the biggest payout in history, aren't peanuts for the average user either.

      Look at page 22 of the settlement agreement pdf: the vouchers range from $15 for EACH OS installation to $23 for each Office installation. Now, when I got my settlement forms in the mail, Microsoft had me down for eight Win98 installations, Win98 SE, WinME, several Office installations, and I think a Win2K installation; I can
  • by nurb432 ( 527695 ) on Wednesday February 14, 2007 @03:18PM (#18015022) Homepage Journal
    Well duh.. even the losing side's laywers get paid well.
    • Re: (Score:3, Insightful)

      by EggyToast ( 858951 )
      Yeah, I love how the article makes it sounds like lawyers don't almost always work for winning case payouts. I'm sure lawyers would love if retainer fees could pay for running an independent business, but that's simply not the case.

      If people are anti-lawyer, they should stop suing people. But then other people would have to stop trying to break the law. <sigh>
      • by Thaelon ( 250687 )
        I think the laws should be written plainly enough that lawyers become unnecessary. The intent of most laws is known without having to read them.

        We (the USA) needs to scrap legal jargon and rewrite the laws plainly, then let a judge decide if the law applies to an act and let the jury decide if they're guilty.

        I mean, stop and think for a second, if a really good lawyer means you get a more favorable outcome, how fucked up is our legal system?
    • Re: (Score:3, Interesting)

      by hackstraw ( 262471 ) *
      Well duh.. even the losing side's laywers get paid well.

      The problem is that MS is a little upset that it cost them some of their beloved cash, but they shake it off and think of this as the cost of doing business. They are like everyone else, they don't want to pay for utilities, taxes, or whatever, but its just the cost of doing what you do.

      What I want is a real judgement or change from these cases, not a glorified parking ticket. What is going to change from this? Nada.

      What is microsoft a monopoly on?
      • I disagree (Score:3, Interesting)

        by rajafarian ( 49150 )
        I say its time for MS to be forced to publish their "standards" and APIs.

        I disagree. I think that Microsoft has to be stopped from using anti-competitive tactics in their way of doing business and the rest will take care of itself. Let them keep their junk, closed source, buggy operating system.

        I say one set of prices for EVERYONE published publicly with no contract tie-ins to any other MS or competing product coming into the equation will take care of everything!
  • by Iphtashu Fitz ( 263795 ) on Wednesday February 14, 2007 @03:18PM (#18015034)

    Almost makes me wish I was a lawyer. Almost.
    • in fact, it seems there is more money to be made in the good ole' USA by SUING for IP than actually INVENTING IP.

      if some kid in college asked me if he should go into law or engineering, I know what I'd say.

      (up until the point where lawyers are OUTSOURCED. now wouldn't that be a nice bit of irony? don't laugh - I bet this move is on its way over the next decade and so lawyers will be 'out of work' just like many of my fellow engineers in the USA are).

      and I do like that comment, a few above this one, that s
  • wow (Score:5, Funny)

    by Billly Gates ( 198444 ) on Wednesday February 14, 2007 @03:21PM (#18015066) Journal
    A coupon so Microsoft can increase sales of more copies of windows.

    Boy, that sure showed Microsoft.
    • Re: (Score:3, Insightful)

      by KKlaus ( 1012919 )
      That's actually more insightful than funny, in my opinion. If I buy a laptop that burns my house down, you think I really want store credit? The worst thing is that I suspect it's actually profitable for the "losing" company when coupons are forced. Customers are drawn back to someone they never would have bought from again because bargains are attractive. Some punishment.
      • Re: (Score:2, Insightful)

        by EvilRyry ( 1025309 )
        Agreed. Grandparent really should be insightful. This certainly isn't the first time that Microsoft has been 'punished' by being forced to give away free products. In reality this just tightens their grip on the market. Especially when schools are involved.
    • by phorm ( 591458 )
      No, but I'd imagine the lawyer bill wasn't exactly a happy thing for them. Unfortunately it sounds like both sides needed to foot those.
  • I have no grudge against most legal professionals, but what a huge waste of time and money. Rules should be enforced to prevent wrong doing rather than punishing for it. MS throwing a huge amount of money into a settlement does very little to help anyone and does no more to rectify a wrong (prehaps less) than jailing a murderer.
    • You expect Justice? ....Lawyers... Microsoft...did I somehow miss another player here?
      • by Azarael ( 896715 )
        No, you're right and that is exactly my point. It isn't justice, and could never have been justice..
        Besides, I'll conceed the point that there's no money in provention, except for the money left in "people's" pockets, everone knows how well the capitalism machine works for "people".
    • Rules should be enforced to prevent wrong doing rather than punishing for it. MS throwing a huge amount of money into a settlement does very little to help anyone and does no more to rectify a wrong (prehaps less) than jailing a murderer.

      How on earth are you going to "enforce rules to prevent wrong" without using punishment methods? You don't execute or jail a murderer in order to resurrect the people he killed; you execute/imprison him so that 1. he's unable to kill any more and 2. others are less likely t

      • by Twanfox ( 185252 )
        Imprisonment of a murderer is 'enforcing rules to prevent wrong [doing]' since, though it doesn't correct for the issues before, it prevents wrong from them doing it again. In the case of Microsoft, they have grown large enough that the punishments written into law are not sufficient in size to hamper them, and do not serve as a deterrent. In a case like this, they need to seek a non-monetary remedy that seeks to prevent future occurrences, much like putting a murderer in jail.

        The Judicial system in the US
      • by Azarael ( 896715 )
        I agree, but that kind of punishment just isn't going to be applied. At this point we're looking at damage done almost a decade ago, which is part of the problem. Sadly, I can't see a clear way that any branch of gov't could have stepped in before 2000 to help fix this before the situation really got out of hand. Now it will take years more, if ever, for the market to really open up to MS alternatives. In the case of software, I think things like open standards backed by governments will help prevent these
    • by ChrisA90278 ( 905188 ) on Wednesday February 14, 2007 @04:10PM (#18015668)
      I've been running for president under the "common sense" party for years. I can solve ALL problems with simple common sense. For example crime: As you say, it is better to PREVENT the crime. So simple common sense says to put people in jail BEFORE they commit the crime. Gosh how easy was that! I'm for the death penalty too. We should execute people before they can murder someone. Prevention, that's the way to go.

      I have other common sense solutions to all the other problems too.

      • by Azarael ( 896715 )
        Meh, you're making a straw man argument by vastly oversimplified solution. I didn't say it was going to be easy, but nothing is every accomplished unless you try. The legal/justice system is by far not the only way to prevent the problems in society, it's just the most obvious (an likely vastly overused one). Unfortunately, it's hard to say whether any other solutions have been successful (and how much) where the justice system seems to have failed.
    • I have no grudge against most legal professionals, but what a huge waste of time and money. Rules should be enforced to prevent wrong doing rather than punishing for it.

      Well, if there were no consequences for vilating the rules, WTF would be the value of the rule? It would be a complete joke -- "you're not allowed to do this", "oh, darn you to heck, you did it again".

      The whole point about rules (ie laws) is there is presumed to be an or else part of it. Once someone has broken the rules, you need to punis

      • by Azarael ( 896715 )
        I don't disagree. I really should have argued that in my opinion, the system leans to far towards punishment (specifically punishment long after the fact), than prevention (punishment much closer to the offence and continual efforts to discourage offences before they happen). Obviously, saying it is much easier than doing it.
    • by sfjoe ( 470510 )
      Rules should be enforced to prevent wrong doing rather than punishing for it.

      Is this a joke? Is there to be some enforcement organization responsible for scrutinizing every activity in order to prevent a misdeed before it occurs? How far do you want Big Brother to go in order to prevent wrongdoing?
      • by Azarael ( 896715 )
        The point was poorly made, it might make more sense to think of it as training or incentives? Bear with me, if you want to bring up a child to use good grammar don't you agree that practising good grammar around them and correcting them when they make a mistake is the way to go about this? Yes, how to go about applying this idea to businesses is unclear. Perhaps finding a way to chang the rules to make anti-compative behavior unprofitable to begin with would be a good way? I don't claim to have the answer,
  • by ATestR ( 1060586 ) on Wednesday February 14, 2007 @03:26PM (#18015116) Homepage

    To be fair, the lawyers should have to take their cut in coupons for Microsoft products, just like everyone else will.

  • NAH! That's objective reporting at it's best. NO bias at ALL!
  • And the truth.. (Score:2, Informative)

    by s31523 ( 926314 )

    but the real winners will no doubt be the lawyers

    Isn't this always the case? I hate these lawsuits because the rich fat-cat lawyers make out and the real people that deserve something get like $10. No sh*t M$ is settling. They have to pay millions of dollars for thousands of dollars in product just because the lawyers litigated the case at 500 per hour. It just sucks, all the people involved as plaintiffs that essentially allow those blood suckers to make millions should get some sort of profit sharing, not just their $10 cut. And don't bitch abou

    • by gravesb ( 967413 )
      Not to defend the amount lawyers make, because it does seem a bit much, but isn't it also logical that a large group of people would go to law school, charge less, and take away an enormous amount of business? Even $10 an hour would make a large difference in big litigation. Maybe the market isn't clear, but there are market forces at work, even in litigation.
    • Where's Erin Brockovich when we need her?

      But seriously thats how these things SHOULD work, lawyers getting a few millions sure, but people actually getting what they deserve as well.
  • by mschuyler ( 197441 ) on Wednesday February 14, 2007 @03:37PM (#18015252) Homepage Journal
    Class action lawsuits are one of the most mis-used legal tactics in the country. Look at ANY class action lawsuit against ANY company. The 'remedy' afforded to consumers is on the same level as a few bucks in rebates: Most people don't bother with jumping through the hoops (and be sure and include the SKU from the inner flap of the outer box you just threw away and a certified copy of your birth certificate) and the companies know this. They don't amount to anything anyway. It's just an accountng trick. But the lawyers, oh, my goodness. Millions of dollars to the law firms for "all their hard work." What a crock. The kids of Iowa will see nothing tangible. /rant
    • Re: (Score:2, Informative)

      by nomadic ( 141991 )
      Look at ANY class action lawsuit against ANY company. The 'remedy' afforded to consumers is on the same level as a few bucks in rebates

      Ok, you completely misunderstand what a class action is. It is not limited exclusively to consumers, or especially large numbers--you can have a class action on behalf of just a few people. And there have been plenty of class actions where class plaintiffs each recovered significant amounts of money. Just because something hasn't been reported on slashdot doesn't mean
    • by gumbi west ( 610122 ) on Wednesday February 14, 2007 @03:57PM (#18015488) Journal
      Here's the thing. Our market uses a capitalist market structure, so the firms that make the most money beat the other firms. Put another way, if there is a way to make more money, the contentious executive who is thinking of his shareholders will make the money (most MBA graduates say that the maximizing shareholder value is the primary focus of an employee).

      In light of this, when someone does something counter competitive, just taking money away from them helps quite a bit. Now we can argue about where it should go, but this is better than the other options (leaving the money with the company that swindled the consumer). Put another way, if one company starts to swindle and nothing happens, all competitors will either start to do the same or go out of business. Class action lawsuits provide some protection against that and are an overall boon for the consumer in net, if not in effect per lawsuit.

    • If you are so bothered by having someone represent you for free, you should just opt out of the class action settlement and file suit yourself. In everyone one of these class action settlements, all known class members will receive a letter from the court informing them of the settlement and of how to opt out (you just need to send a letter to the court). I'm sure most people receive several of these every year and just throw them out because they haven't been harmed enough to care.

      As for the "kids of

      • He did that with the tobacco company lawsuits. In that case, the money was supposed to go to the state Medicaid fund.

        It didn't.
    • by John Grisham. It's about how class-action suits work, or don't, at least for the members of the class. Very interesting reading. Be prepared to be angry whenever you hear the term class-action. The only winners are the lawyers. I wish, as another poster commented, that they were paid with Microsoft coupons.
      • Read it and I agree with your recommendation
      • Not sure if you know this, but Grisham is a novelist, and a good one at that. As with all good writers, the focus is on what makes the best story, not what is reality. I've never read this book so I can't refute it's central points, but I can't imagine a country without tort and without class action tort.

        In the end, the system isn't perfect, but having the lawyers get rich is better than having the companys get rich mainly because of the incentive system that it sets up for companies.

        put it this way, if yo

    • Re: (Score:2, Insightful)

      by Oddster ( 628633 )
      You are absolutely, one-hundred percent wrong. Class action lawsuits in the United States are the most sane and civil form of business-consumer conflict resolution this world has ever seen, and are in fact the only way in this country for consumers to get justice against unsavory businesses. If you knew anything in detail about class action lawsuits, there is no way you would ever espouse the opinion you do, period. The only way you could be under this perception is that you have been reading about noth
    • People work for money. If you didn't provide incentives for lawyers, they would not try to redress these wrongs. In the long run, class action litigation deters businesses from misbehaving.
    • Don't be ridiculous. Legal fees have nothing to do with the amount in settlement awarded for damages. They make money because that's their billing rate plus actual expenses--that's what legal fees ARE. So when the award is legal fees plus damages, you're not sharing money from the same pool. The fact that you wind up with little in the end is because the court decides that, say, $90 million in damages is enough--but when you've got 30 million affected consumers, that's only $3 each. The award is a basi
  • Good to know (Score:2, Insightful)

    by Anonymous Coward
    Wow, I never knew you could sue people if for overcharging. This is great. Now I am going to go sue that burger place i just ate at for charging me $10 for a burger, when it obviously should have cost six dollars (according to Carl's Jr.)

    And for some reason, I thought we won the cold war...
    • by anagama ( 611277 )
      Terrible analogy. The fact that you have a choice to spend $10 or $6 on a burger means the price you paid was fair (if you thought the price was unfair, you would have gone elsewhere). Plainly, the more expensive burger joint thinks the merits of its burgers exceed those of the fast food joint's.

      In contrast, the very point of monopoly litigation is that the is nowhere else to go. No competition.
      • You're right, there is no other operating system I can buy besides Microsoft Windows. I'm glad you cleared up that egregious error in logic.

        Linux doesn't exist, MacOS doesn't exist, *BSD doesn't exist, and none of the dozens of more specialized OS's actually exist.

        • by anagama ( 611277 )
          You don't have to tell me that. The last Windows I owned or used was ME. But the existence of fringe OSes (and I don't mean "fring" to be any sort of insult, just an acceptance of market share data) doesn't mean that MS has not engaged in monopolistic pricing and practices.

          Perhaps the better analogy would that there are several tofu burger joints giving out free lunches, and a meat burger joint charging $20 a meal. Nobody believes the tofu burgers are good, or somehow has managed to fail to notice the
    • Wow, I never knew you could sue people if for overcharging.

      Dude, the lawsuit was supposed to have been not so much about overcharging but over the things they did and still do to allow the overcharging. Things, you know, like penalizing OEMs for installing alternate operating systems.

      I read some things that came out about Microsoft and Gates during the lawsuit and I came out thinking that Gates IS evil and his charity foundation has to be more about PR than actually helping someone else out, although they
  • by Greyfox ( 87712 )
    Demanding $60 million from Microsoft is like Dr. Evil demanding ONE MILLION DOLLARS from the World's Leaders today. Bill Gates could probably find that much money just by scrounging around in the various couches in his mansion. That provides no incentive for the company to change its behavior. No... if you want them to take notice you need to ding them for THIRTY THREE BILLION DOLLARS! Mua ha ha ha ha ha ha haaaa!
  • by zappepcs ( 820751 ) on Wednesday February 14, 2007 @03:44PM (#18015324) Journal
    that is when the people who are dissatisfied with MS and how the courts fail to create fair business practices from them all switch to Linux or Apple.... THAT would be justice
    • Switching to free software is far better than switching from one master to another. Apple is largely just another proprietor, but with a completely free software operating system and only free software apps on top of that, you can liberate yourself from proprietors/monopolists.
  • by RyoShin ( 610051 ) <tukaro AT gmail DOT com> on Wednesday February 14, 2007 @03:53PM (#18015436) Homepage Journal

    but the real winners will no doubt be the lawyers
    Of course, but here Microsoft wins, too. The article doesn't say how the exact payment would be (the article says just "millions of dollars"), but we'll be conservative and say that Microsoft will have to pay out at least 50 million (if it were 100 million, they probably would have said "hundreds of millions"). A quick Google search says that their revenue is around 10 billion. That means they have to pay a half of a percent of their annual revenue. Looking at it another way, it will take them less than a week to recoup that.

    This is only a bit more of a punishment than the fine from the EU of a couple ten thousand dollars a day.

    And what else do they have to give out? More Microsoft products! Either a voucher, or software for schools. And from that comes support contracts, future upgrades, additional add-ons, all which will cost the schools and/or users additional money.

    Why do courts and defendants even allow this? If I cut myself with a razor because it was used shoddy construction and a blade wasn't secured properly, and sue the company, why would I want another razor from them? I may get the razor free, but I still wind up having to buy blades for it later.

    Granted, they aren't saying they don't want Windows, just that they were overcharged, but this still seems ludicrous.
  • by frovingslosh ( 582462 ) on Wednesday February 14, 2007 @03:54PM (#18015462)
    So when do we start the law suits against the lawyers who screw the average guy by filing lawsuits on their behalf and then making all the profits and getting us coupons? Seems like a lawsuit that the jury couldn't help but award to us.
  • Microsoft cannot begin to dream of reaching the level of evil that lawyers as a group have attained. You think the cost of having a Microsoft monopoly is high? Lawyers and legal organizations increase the cost of every single thing you ever bought in your life, from penny candy to auto insurance. They take a portion of every bit of money that changes hands for legal reasons, they siphon money off of broken families and child support settlements, and from birth death they get their cut every step of the way.
  • Anyone have the documents mirrored? The site now requires authentication.
  • Helping schoolkids? (Score:3, Informative)

    by Doctor Memory ( 6336 ) on Wednesday February 14, 2007 @04:09PM (#18015658)

    the software giant will certainly be on the hook for millions of dollars, some of which may end up helping Iowa school kids
    Oh, yeah, Microsoft loves helping schools. I remember when I lived in Portland, Microsoft was incredibly helpful [].

    Actually, as it turned out, they were helpful — they helped spur the development of K12OS []...
  • by Intron ( 870560 )
    What I thought was interesting is the claim that Windows adds $50 on average to the cost of a computer, pre-installed. First off, that's a lot less than the retail price. Second, regardless what you think of it, it's pretty cheap for a substantial piece of software that comes with installation and support.
  • As a citizen (Score:3, Insightful)

    by Maxo-Texas ( 864189 ) on Wednesday February 14, 2007 @04:13PM (#18015718)
    these cases really upset me.
    I get mail all the time showing the lawyers are going to make 4 to 16 million dollars and as a member of the class I'll get less than a hundred bucks. I do not join the class. I know ultimately, i'm going to be paying higher prices because of this crap.
  • The lawyer's fees should be limited to a percentage of the actual damages collected by their clients. Using pseudo calculations like, "5 million customers would be given as much as 30$ worth of coupons and so the lawyers will collect 50 million dollars (33% of the total) in hard cash right now" is a farce. Just making sure that the lawyer's take would not exceed 33% of the what the class of victims collect as a total would be a step in the right direction. In the present system, once the award is declared a
  • And Microsoft is still a monopoly. If Iowa dealt with all organized criminals by just making them give back what they'd stolen when caught, every Iowan would have to join the gang to make a living.
  • the team prosecuting the case has already earned $60 million in legal fees

    Normally I try to look for the other side of the story, and give the benefit of the doubt to who/whatever is being maligned by the Slash&burn summary or the groupthink. In this case, however, I find it very difficult. While fees != profit, it's hard to believe that the investigation, research, and preperation expenses would amount to more than a third of that figure. Additionally, the acceptance of a settlement indicates that t
  • Microsoft Is Evil (Score:2, Interesting)

    by dbdunn23 ( 1061588 )
    Yes I know all you /.ers are gonna bash me for this, but quit acting like MS is the only corporation that buys market share. Do you think automobiles still run on gasoline because car makers think it is a good idea? No, they run on gasoline b/c Exxon/Mobil has paid for them to run on gasoline. Do you think Gov. Perry (Texas) passed a law that requires all pre-adolescent girls to get vaccinated against an STD b/c he thinks it is in their best interest? No, he passed the law b/c Merck gave him a s**t load
  • by Rick Richardson ( 87058 ) on Wednesday February 14, 2007 @06:45PM (#18017518) Homepage
    02/13/2006 FUNDS RECEIVED *type: *DEPOSIT $251.00

    $251.00 is serious money from Microsoft Corp, NOT "Average consumers will probably end up with a few bucks or a coupon".
  • Wouldn't it be nice (Score:2, Interesting)

    by bwbadger ( 706071 )
    Wouldn't it be nice if the judge could rule that the public good would be best served by seeing the case through, and did indeed ruled so in this case?
  • I have a few hundred dollars worth of vouchers from the California M$ anti-trust settlement. They want me to send in my original receipts (from 5 years ago) in order to redeem them. For me, it's not worth the trouble to sift through my old records to see if I have them. A better solution would have been to allow for the use of product serial numbers -- they are readily available. I'm sure that I am in the majority. What this means is the the California settlement was a BIG WIN for M$.
  • by smchris ( 464899 ) on Wednesday February 14, 2007 @10:31PM (#18019570)
    The Minnesota settlement got my wife and me a refurb Epson 2400 scanner, a cheap HP inkjet (both linux compatible) and three LinuxStore "Tux" keyboards from Cheapbytes.

    I'll take it. But, yes, I would rather be using IBM OS/4 HyperDrive today.

Any sufficiently advanced technology is indistinguishable from a rigged demo.