Microsoft and Vermont Plaintiffs Settle Vermont Class Action Lawsuit

Editor’s Note, July 6, 2004:
The final (seventh) paragraph below has been updated since original publication to clarify that businesses as well as consumers will be eligible.

BURLINGTON, Vermont, and REDMOND, Wash., July 1, 2004 — The law firms of Johnson & Perkinson and Potter Stewart Law Offices, P.C., counsel for a proposed class of Vermont consumers, and Microsoft Corp. jointly announced today that a settlement has been reached in a class action lawsuit alleging that Microsoft Corp. violated Vermont’s consumer fraud act.

The settlement, which received preliminary approval on July 1, 2004 from the Superior Court for the County of Windham, Vermont, 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 claims vouchers, and the maximum value of the vouchers that may be issued to class members will be $9.7 million.

Under the terms of the settlement agreement, Microsoft will provide one-half of the difference between $9.7 million and the value of vouchers issued to class members to Vermonts public schools in the form of vouchers that may be used by the 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 or distributed as determined by the judge presiding over the settlement.

“We’re pleased with the judges decision, and think it’s a great settlement for the class and for needy Vermont schools,” said Jake Perkinson, attorney for the plaintiffs. “We’re pleased that the case now moves forward to final resolution.”

Vermont Governor Jim Douglas expressed his support of the court’s adoption of the settlement proposed by the parties. “This settlement will be a benefit to Vermont schools and the children that attend them,” Governor Douglas said. “Technology is a wonderful tool for teachers and helps to improve student learning by providing a well rounded curriculum. Using technology also encourages students to be engaged and invested in their work far beyond the walls of the classroom, and they have fun while they’re doing it.”

“We’re pleased by the opportunity to help schools all across Vermont 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 the Superior Court for the County of Windham, Vermont. Under the settlement, consumers and businesses that, between March 31, 1995 and December 31, 2002, resided in Vermont and purchased certain Microsoft operating system, productivity suite, spreadsheet or word processing software for use in Vermont 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 solutions that help people and businesses realize their full potential.

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