Microsoft and District of Columbia Plaintiffs Settle District of Columbia Class Action Lawsuits

WASHINGTON, and REDMOND, Wash., Oct. 28, 2003 — The law firms of Milberg Weiss Bershad Hynes & Lerach LLP; the Heideman Law Group PC; Mark D. Bogen, PA; Hall Estill; and Thomas Willcox, Esq., counsel for a proposed class of District of Columbia consumers, and Microsoft Corp. today jointly announced that a settlement has been reached in a class action lawsuit alleging that Microsoft violated District of Columbia antitrust law.

The settlement, which received preliminary approval Friday from the Superior Court of the District of Columbia, will make vouchers available to class members that may be used to buy any manufacturer’s desktop, laptop and tablet computers, any software available for sale to the general public and used with those computer products, and specified peripheral devices for use with computers. The total amount of vouchers issued will depend on the number of class members who claim vouchers. The maximum value of the vouchers that may be issued to class members will total $6.2 million.

Under the terms of the settlement agreement, Microsoft will provide one-half of the difference between $6.2 million and the value of vouchers issued to class members to District of Columbia public schools in the form of vouchers that may be used by schools to purchase a broad range of hardware products, Microsoft®
and non-Microsoft software, and professional development services. The vouchers will be made available to public schools in which 50 percent or more of the students are eligible for reduced-fee or free meals under the National School Lunch Program.

The company estimates that 126 schools, serving more than 37,223 students, will be eligible to receive assistance. This represents nearly 58 percent of all District of Columbia students.

Len Simon of Milberg Weiss said that the settlement was “a win/win situation. Every class member can make a claim and get a voucher for computer goods, and if it turns out that claims are lower than we hope, the D.C. schools will get a large quantity of computer goods for their use.”

“We’re pleased by the opportunity to help schools in the District of Columbia get the computers and software they need,” said Brad Smith, general counsel for Microsoft. “This settlement allows us to focus on the future and building great software, and avoids the cost and uncertainty of litigation.”

Details of the settlement are set forth in a settlement agreement filed in District of Columbia Superior Court. Under the settlement, consumers who, between Feb. 15, 1996, and Dec. 31, 2002, resided in the District of Columbia and indirectly purchased certain Microsoft operating system, productivity suite, spreadsheet or word processing software for use in the District of Columbia and not for resale will be eligible to apply for the vouchers.

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and Internet technologies for personal and business computing. The company offers a wide range of products and services designed to empower people through great software — any time, any place and on any device.

Microsoft is a registered trademark of Microsoft Corp. in the United States and/or other countries.

The names of actual companies and products mentioned herein may be the trademarks of their respective owners.

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