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Iowa Schools to Receive $60 Million for New Technology

Posted On:Friday, December 11, 2009

Zelle Hofmann, co-lead counsel for the plaintiffs in the Iowa Microsoft antitrust lawsuit, recently announced that more than $57 million in cash and vouchers has been distributed to over 116,000 Iowa consumers, businesses and Iowa state and local governments. Unlike any of the other indirect purchaser class action settlements with Microsoft across the country, the $179.95 million settlement negotiated by Zelle Hofmann and its co-lead counsel required Microsoft to pay consumers cash. Under terms of the 2007 court-approved settlement, consumers, businesses and Iowa state and local governments that purchased certain Microsoft software for use in Iowa were eligible to receive cash payments or vouchers to purchase computers, peripheral computer hardware, and software from any manufacturer, not just Microsoft.

Microsoft also agreed to provide one-half of any unclaimed funds under the settlement to Iowa public schools in the form of vouchers. Beginning in January 2010, Iowa public schools will receive more than $60 million in vouchers to be used to purchase new computer hardware and software. Additionally, Microsoft provided $1 million in cash to the Iowa Legal Aid Society.

Comes v. Microsoft, only the second consumer class action case against Microsoft to go to trial, alleged that Microsoft violated Iowa's antitrust and unfair competition laws and thereby overcharged consumers, businesses and Iowa state and local governments for certain of its products. Plaintiffs argued that Microsoft charged higher prices than it would have charged had it not engaged in the anticompetitive conduct. Plaintiffs also argued that Microsoft's conduct caused its operating systems software to be more vulnerable to security breaches. Plaintiffs sought damages for their injuries. The case settled on February 14, 2007, after approximately three months of trial.

Zealous Women Lindsey Davis and Liz Kniffen were involved in this matter. In particular, Lindsey has primary responsibility for supervising the administration of the settlement, and she also participated in the pre-trial and trial proceedings.