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West Virginia Settles in Antitrust Case

Holding out of the Microsoft antitrust settlement paid off in a big way for West Virginia. The state, one of the poorest in the nation, settled on Monday with the software giant for $21 million in cash and vouchers.

"When we first filed the damage case, no, we didn’t expect this," Doug Davis, a West Virginia assistant attorney general, told the Charleston (W.Va.) Gazette late Monday. "We didn’t imagine we’d get this high of a number." By comparison, the seven states that settled with Microsoft in December after pursuing an appeal of the main settlement between Microsoft, the U.S. Department of Justice and nine states, got $28.6 million from Microsoft to split among them.

Massachusetts, which is joined in its appeal by several trade groups, is the only state remaining in the case that began in 1998 with Microsoft facing off against the federal government, 20 states and the District of Columbia. Massachusetts officials said Monday that they would continue their appeal, which is expected to be heard in November in the U.S. Court of Appeals in Washington, D.C.

The West Virginia settlement requires Microsoft to pay West Virginia $1.3 million in cash and $19.7 million in vouchers. Some $1 million worth of the vouchers will go to West Virginia schools to allow them to buy hardware and software from any manufacturer. Attorney General Darrell McGraw gets another $700,000 in general purpose vouchers to distribute for the benefit of state citizens. For consumers and business, $18 million in vouchers will be available. Of those, any unclaimed vouchers will go to the state's public schools for additional hardware, software and professional development services.

The settlement received preliminary approval from Boone County (W.Va.) Circuit Judge E. Lee Schlaegel. Final consideration is expected within 60 days.

Microsoft settled the long-running case with the Bush Administration Justice Department and nine other states late in 2001. The nine non-settling states offered the court a harsher set of antitrust penalties for Microsoft that U.S. District Judge Colleen Kollar-Kotelly considered along with the proposed settlement in parallel hearings in 2002. In the end, the judge upheld most of the antitrust settlement and rejected nearly all of the non-settling states' remedy proposals.

About the Author

Scott Bekker is editor in chief of Redmond Channel Partner magazine.

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