Microsoft and Nebraska Plaintiffs Settle Nebraska Class Action Lawsuit

FREMONT, Nebraska., and REDMOND, Wash. — April 28, 2005 — The law firm of Yost, Schafersman, Lamme, Hillis, Mitchell & Schulz, PC, counsel for a proposed class of Nebraska consumers, and Microsoft Corp. today jointly announced that a settlement has been reached in a class action lawsuit alleging that Microsoft violated Nebraska’s antitrust and unfair competition laws.

The settlement, which received preliminary approval today from the District Court of Dodge County, Nebraska, 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, and the maximum value of the vouchers that may be issued to class members will total $22.6 million. Members of the class submitting claims for up to five licenses will be able to do so by sworn declaration without documentation of proof of purchase.

Under the terms of the settlement agreement, Microsoft will provide one-half of the difference between $22.6 million and the value of vouchers issued to class members to eligible schools in Nebraska in the form of vouchers that may be used to purchase a broad range of hardware products, Microsoft® and non-Microsoft software, and professional development services that will benefit Nebraska schools. Eligible schools are public schools (K-12) in which at least 50% of the attending students are eligible to receive free or reduced price meals through the National School Lunch Program.

Robert M. Hillis, attorney for the Plaintiffs, stated “We’re very pleased with the settlement and the recovery that will be made by Nebraska consumers and businesses. In addition, we are very happy with the structure of the settlement that will benefit the school children of Nebraska.”

“This settlement will help schools all across Nebraska get the computers and software they need,” said Tom Burt, corporate vice president and deputy 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.”

Nebraska consumers and businesses who purchased certain Microsoft products between February 28, 1997 and December 31, 2002, will be entitled to make recovery. Purchases of Microsoft operating systems covered by this settlement include MS-DOS, Windows 95, Windows 98, Windows 98 Second Edition, Windows Millennium Edition, Windows for Workgroups, Windows NT Workstation and Windows 2000 Professional. Microsoft applications in this settlement mean Word, Excel and Office versions designed for computers with the above MS DOS or Windows operating systems.

Details of the settlement are set forth in a settlement agreement filed in the District Court of Dodge County, Nebraska. Under the settlement, consumers who, between February 28, 1997 and December 31, 2002, resided in Nebraska and indirectly purchased certain Microsoft operating system, productivity suite, spreadsheet or word processing software for use in Nebraska and not for resale will be eligible to apply for the vouchers.

Legal notice of this settlement, claim forms, and instructions for filing claims, will be published in approximately two months. Consumers and businesses desiring to file a claim or who need information about the settlement can visit or call (866) 778-1153.

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