Slashdot Mirror


Microsoft Settles Minnesota Antitrust Suit

An anonymous reader writes "According to the Star Tribune: 'The Microsoft antitrust suit in Minnesota was settled out-of-court Monday seven weeks after it began, but before the plaintiffs even finished putting on their case before the jury. Terms of the settlement won't be disclosed until they are finalized and presented to a Hennepin County judge for preliminary approval 'in early summer,' Microsoft said in a statement. The antitrust suit in Hennepin Country District Court sought as much as half a billion dollars from Microsoft for alleged overcharges of more than 1 million Minnesota consumers and businesses who bought Microsoft Windows, Word or Excel software between 1994 and 2001.'"

49 of 176 comments (clear)

  1. What is Minnesota doing... by nberardi · · Score: 3, Insightful

    What is Minnesota running out of money just like the EU? So they try to hit up the cash cow, I think we will see more and more of these suits comming out, and all that it is going to do is make it so generic that they will get thrown out on the spot.

    1. Re:What is Minnesota doing... by macmaniac · · Score: 5, Interesting
      It's a pretty interesting application of anti-trust legislation: seems Minnesota tried to leverage that Microsoft was a monopoly which then put its competitors off, resulting in Minnesotans being overcharged for proprietary software, despite alternatives still existing.

      Seems like a bit of a stretch for a lawsuit to me. However, it must have gotten someone at Microsoft scared, else they wouldn't have settled it.

    2. Re:What is Minnesota doing... by mls · · Score: 5, Informative

      What is Minnesota running out of money just like the EU? So they try to hit up the cash cow...

      Well, MN is running out of money, but that isn't what this is about.

      MN was one of the original states in the anti-trust lawsuit. When the other states settled, we didn't.

      It just took this long to pan out.

      --
      -mls
    3. Re:What is Minnesota doing... by nberardi · · Score: 5, Insightful

      It is usually cheaper to settle out of court than put this in the public domain. Look at what happened to OJ for instance, he was found guilty, but everybody thinks he is guilty except in the eyes of the law. Microsoft doesn't care what the law thinks of them, they care what their customers think of them, and that is why it is always cheaper to settle, and not set a president.

    4. Re:What is Minnesota doing... by ePhil_One · · Score: 2, Insightful
      However, it must have gotten someone at Microsoft scared, else they wouldn't have settled it.

      I'm not sure. They may have just as well want Minnesota to sign a document with terms that they never would have agreed to under normal circumstances. MN gets a cash payout, but inadvertently indemifies MS against all future action, lest they have to pay back the money. We all know MS can be sneaky about the fine print.

      --
      You are in a maze of twisted little posts, all alike.
    5. Re:What is Minnesota doing... by Anonymous Coward · · Score: 3, Insightful

      If they really cared about what people thought, they could have settled this whole anti-trust thing back before it started and avoided 5 years of news coverage. Probably would have been a lot cheaper as well.

    6. Re:What is Minnesota doing... by mgoodman · · Score: 2, Informative

      Errr, except that OJ didn't really have the option to settle...

      And when he did have the option to settle in his civil suit, he didn't. And lost.

      I bow before you, king of screwed up analogies!

      --
      01100111 01100101 01110100 00100000 01101111 01110101 01110100 00100000 01101101 01101111 01110010 01100101 00101110
    7. Re:What is Minnesota doing... by strictnein · · Score: 4, Insightful

      Won a big settlement, most of which went into the pockets of Mike Cerici

      He and his buds only got about $250 million. (chump change) The state got $7 - $8 billion.

      What I loved about the results of that case was that when the public found out how much money ($250 million) that one little lawyers firm got a lot of people were pretty upset. But our friendly attorney general said that amount was "fair" (I'll give you one guess as to what political party he's affiliated with). I wonder how jealous the state's lawyers were when they saw the millions of dollars that Mr Cerici and his buds got in comparison to their public (albeit still good) wages.

    8. Re:What is Minnesota doing... by Lord+Kano · · Score: 3, Insightful

      So they try to hit up the cash cow, I think we will see more and more of these suits comming out, and all that it is going to do is make it so generic that they will get thrown out on the spot.

      The suits against the tobacco and gun industries have opened the floodgates. Whenever a state needs revenue it'll sue the biggest unpopular company it can find.

      Personally I don't believe that a monetary solution is what an entity would go after if they REALLY wanted to stop Microsofts practices. They'd seek to punish them by forcing them to open their code.

      THAT would alter Microsoft's behavior overnight.

      LK

      --
      "Hi. This is my friend, Jack Shit, and you don't know him." - Lord Kano
  2. Good thing by Anonymous Coward · · Score: 4, Funny

    Or else Minnesota may have sent Brock Lesnar and Jesse Ventura after them. They could easily beat Gates and Ballmer in a tag match.

  3. Is this the new MS strategy? by koa · · Score: 4, Insightful

    Just throw money at every piece of litigation they are in? Are they trying to artificially boost their public perception by being in as little lawsuits as possible?

    --
    ....move along....nothing to see here....
    1. Re:Is this the new MS strategy? by Ian_Bailey · · Score: 2, Informative
    2. Re:Is this the new MS strategy? by the_mad_poster · · Score: 4, Interesting

      Does that surprise you? If you can throw money at a problem and that costs you less than getting in the fight, that's what you should do, as a company. It's not like they're strapped for cash.

      Besides, the plaintiff is under no obligation to take a settlement offer, so they must have found the terms acceptable based on their complaint.

      --
      Alito: A vote for Alito is a punch in the eye to put that bitch back in her place!
    3. Re:Is this the new MS strategy? by prell · · Score: 2, Insightful

      I think the chief motive for MS to settle these lawsuits is that, written into the settlements is that, in exchange for money, Microsoft acknowledges no cupability or guilt as stated in the indictment/whatever. I think that's a standard clause of these settlements. Someone will have to correct me if I'm wrong.

      Has Microsoft not settled one of these? I imagine if they didn't settle, and therefore accepted blame (if that's indeed the case), it would set a precedent that could really cost MS some money in the long run.

      IANALBIWLO (I am not a lawyer, but I watch Law & Order).

  4. Other Sources by JaxWeb · · Score: 5, Informative

    PC World

    Forbes

    FT.com (A good one!)

    --
    - Jax
  5. As I live in MN... by teamhasnoi · · Score: 5, Interesting
    I've been following this somewhat. Minnesota was one of the original states in the anti-trust trial that went nowhere. Frankly, I'm expecting the same from this. Coupons, vouchers, and 'free' educational software that will be charged against the judgment at full retail value.

    Score one for the little guy? I doubt it.

    MS should have been broken up like Ma Bell a long time ago.

    1. Re:As I live in MN... by Gaijin42 · · Score: 4, Insightful

      The microsoft to Ma Bell analogy holds little water.

      Bell was a large company, broken into several smaller companies, each allowing to provide service to a given area. No restrictions were made on what type of product each baby bell was allowed to produce, or the prices each baby bell could set (other than the pricing regulations already in effect)

      The other large anti-trust case, (Standard Oil) was the same. Location of service were split into multiple companies, not type of service.

      Microsoft is a producer of goods, not a distributor of goods. The things that they do distribute (Software downloads, services) aren't really location based. As Slashdot is well aware, the internet has no boundries.

      There are 0/None/Nada precidents for splitting up a company based on product, or telling a company what products they can create.

      While MS did (and may continue to, depending on who you ask) act uncompetitavley, this power would not be removed by any logical splitup.

      If you split them into OS vs Office for example, the major source of anti-compete accusations in the past was bundling of features within the OS, or forced contracts on OEMs. Neither of these would be fixed by this (proposed) split.

      As stated, geographical splits don't really make sense for a virtual company. You could split up distribution, but MS doesnt really do their own distribution except for downloads. Everything is already passed out to OEMs or chains like Best Buy.

      The only thing you could do would be to make the internal departments act like Black Boxes to eachother. The office team doesn't get any inside info on the OS that isnt available to other developers.

      Even with that, MS is still a defacto monopoly. Very few buisiness apps or games run on non-MS hardware (Discounting mainframe and huge unix apps like SAP that MS isn't even competing with)

      In office they have a defacto standard, because everyone wants their files to be readable by as many people as possible. The new XML file formats will significantly lower the barrier for entry into that market tho.

      And finally, The fact that Mac and Linux are claiming such good marketing position, is in fact evidince AGAINST MS being given a radical splitup. If you really want MS to get split up, make Apple and Redhat say that they are closing because MS drove them into the ground.

      As long as they are around, all MS will get is "corrective" action.

  6. Yeah, whatever... by shrykk · · Score: 5, Insightful

    Microsoft are like that car company (Ford???) who decided it was cheaper to compensate burn sufferers and the bereaved than fix the gaping flaw that made their fuel tanks tend to catch fire.

    Microsoft can pay fines out of their petty cash, while perpetrating similar tricks over and over.

    --
    #define struct union /* Reduce memory usage */
    1. Re:Yeah, whatever... by Goobermunch · · Score: 3, Interesting

      In all fairness to Ford, they were simply applying a straightforward economic risk assesment when they released the Pinto.

      Evaluate your risk of harm, evaluate the cost of dealing with the results of the harm, and compare with the cost of

  7. Settled for what? by Gothmolly · · Score: 4, Insightful

    "Free" copies of WindowsXP? "Free" copies of MS-Word? a $4 coupon off your next purchase of $600 software? MS is just extending their monopoly, probably dangling a carrot in front of the schools, after all, who can fault them if its 'for the kids' ?

    --
    I want to delete my account but Slashdot doesn't allow it.
  8. Why the gubamint? by gr8_phk · · Score: 4, Interesting
    I don't understand. If the people of that state were overcharged, why is the state getting a big pile of money?

    Could be the state got overcharged, but there are enough other cases where it works the way I interpreted this one to ask anyway.

    1. Re:Why the gubamint? by nberardi · · Score: 5, Insightful

      For the same reason states got cigeratte money instead of the public for smoking and putting up with second hand smoke. Then they turned around and used that money for everything but the intended purpose. Which I really think what MN is hoping to do here.

    2. Re:Why the gubamint? by plover · · Score: 3, Informative
      No, Minnesota took their tobacco settlement money ($4.5 billion) and after enriching the law firm (to the tune of $450,000,000 which averaged out to around $3000/hr for everyone in the company, including the janitorial staff) actually put a pile of it aside for the intended purpose of preventing kids from smoking. They created a project called "Target Market" and they paid for lots of commercials featuring stuff like body bags being dumped on the steps of R.J.Reynolds Corp., etc. The campaign was supposed to be "edgy", "hip" and "relevant" and all those other current marketing words. They were somewhat interesting, but damned if I know if it worked, I'm older than that and I've never smoked.

      Anyway, this year the state eyeballed that big ole Pile-O-Money and said, "Hmm...health of kids vs. budget deficit and a no new taxes pledge." You get 0 points for guessing which one won. Research has shown that youth smoking is up in the six months following the end of the campaign, but whether it's a true cause and effect is anyone's guess.

      --
      John
  9. Re:heh.... by Adriax · · Score: 2, Interesting

    What we need is for the goverment to start seizing 10% of microsoft's assets a year until they change their ways.

    Not enough to kill them off (which would be devastating, considering winXP would stop running), but enough to wake them up.

    --
    I don't suffer from insanity, I enjoy every minute of it!
  10. I wonder.. by mikeophile · · Score: 3, Insightful
    Will the one million overcharged customers be seeing any of this settlement? Or is this just a penalty being assessed by the state?

    If so, I can see why M$ would settle.

    A win against them in court by the state would make it a lot easier for a class-action suit to also win, setting even further precedent in other states.

  11. Get ready for the Linux FUD.. by -tji · · Score: 2, Insightful

    Microsoft is going full throttle to settle all outstanding lawsuits. It wouldn't do to have a bunch of outstanding legal battles while you're throwing mud at Linux and questioning the legal security of the businesses that are using it.

    Regardless of how the SCO thing works out, you can be sure that MSFT will be using this FUD when trying to close deals with big business customers.

  12. I didn't suspect this to happen so soon by mistermoonlight · · Score: 2, Informative

    I'm glad to hear it. At least some states are sticking to their intentions of getting the money they were screwed out of, or screwed themselves out of.

    *begin offtopic*

    And yes, we need the money. The current governer has decided that his priorities are with the suburbanites, further widening the schism between upper and lower class.

    (BALLMER)TAX CUTS! TAX CUTS! TAX CUTS!(/BALLMER)

    *end offtopic*

  13. Minnesota simply looked at the chances... by Marnhinn · · Score: 3, Insightful

    Also a fellow Minnesotan (and proud to be one), I can see why they chose to settle the suit. It may not have helped the little guy, but given Microsoft more or less got off from the Federal Government, chances of this suit succeeding are very slim. Also - MS has been paying out CASH for quite a few of it's settlements - from the article "Microsoft previously paid $1.55 billion to settle similar suits in nine other states and the District of Columbia."

    Hopefully this will result in that type of settlement and not the "free educational software" [which is ironic as the suit is because Microsoft was a monopoly - letting them put their software in schools only increases the monopoly].

    --
    There is always a frontier where there is an open and willing mind
    1. Re:Minnesota simply looked at the chances... by jasondlee · · Score: 2, Insightful

      That doesn't say it was paid in cash. I think the OP has a very good point...

      jason

      --
      jason
      Have a good day?! Impossible! I'm at work!
  14. M$ Settlements by blutrot · · Score: 5, Informative
    On the same case:
    ``Wash.-based software giant to reach trial. Microsoft has reached settlements in nine states and Washington, D.C., totaling $1.5 billion, including $1.1 billion in California. Cases were dismissed in 16 other states.'' Minnesota plaintiffs near court date with Microsoft on overcharge claims


    This leaves us with 24 more states that have not come to any decision or have not gone after Microsoft.

    Minnesota's citizens were overcharged between $10 to $70 a year. 9.7 million licenses were overcharged from 1994 to 2001. Silicon Valley
  15. Is M$SFT Guilty? by TheJavaGuy · · Score: 4, Insightful
    Here is a qoute from the article:

    Microsoft attorneys said the company had done nothing wrong...

    Then why settle even before the plaintiffs even finished putting on their case before the jury?

    Could it be the case was compelling?

    --
    Opera Watch - An Opera browser blog.
    1. Re:Is M$SFT Guilty? by Goobermunch · · Score: 2, Insightful

      Actually, it's more likely that Minnesota's AG realized that they weren't going to be able to convince a jury of every element they needed to hit in order to obtain a favorable verdict.

      The situation goes like this:

      MN isn't sure they'll win, but MSFT isn't sure that it will be able to overcome local prejudice. What do you do? Give it to an unpredictable jury? Or make a decision everyone can live with?

      --AC

    2. Re:Is M$SFT Guilty? by donutello · · Score: 5, Insightful

      Let me play the devils advocate here.

      Could it be because the legal system in the country is so screwed up that it is simpler for a company to just settle every lawsuit it faces, regardless of merit, than it is to fight the lawsuit and win? Of course you could just as easily argue that fighting the case would have cost MN more than it would get if it won compared to what it got in the settlement.

      There are two sides to every coin. One thing I think we can all agree to is that there is something seriously wrong with a legal system when the cost of prosecuting or defending a case is a significant factor in the direction a case goes.

      --
      Mmmm.. Donuts
  16. Between 1994 and 2001... by Patris_Magnus · · Score: 5, Interesting

    There was other software available. The desktop users may have not wanted to try and learn new/other software or had an IT dept. that was willing to administer multiple party apps., point being that we should learn to live with our decisions instead of suing over them... Something to think about.

    1. Re:Between 1994 and 2001... by NullProg · · Score: 3, Informative

      Hmm,

      No there wasn't even if you wanted to. Don't you remember the Licensing restrictions Microsoft made the PC Makers sign in order to get attractive windows pricing?

      Typical consumer call to Dell (or IBM, Compaq, Acer, Gateway, etc).

      Consumer: I want a computer with OS/2 on it.
      Dell: We only ship with Windows.
      Consumer: Then I want a computer with Dr. DOS on it.
      Dell: We only ship with Windows
      Consumer: Can I have a computer without an OS for $100 less?
      Dell: No, we only ship with Windows

      Enjoy,

      --
      It's just the normal noises in here.
  17. Yup. Think of the kids. by eclectro · · Score: 2, Interesting


    I'm not the only one who immediately knew what the settlement terms are.

    Free software for schools, and $5 dollars off your next X-box purchase.

    And probably a few million for the cash-strapped state.

    "Toss them a bone."

    It works every time. And it's back to business as usually for our favorite megamonopoly.

    --
    Take the cheese to sickbay, the doctor should see it as soon as possible - B'Elanna Torres, "Learning Curve"
  18. Wow. by hot_Karls_bad_cavern · · Score: 3, Insightful

    Yep, i agree. Will someone please address this issue? i know we live in a time when a law suit is both a legit way to "right a wrong" and a way to intimidate, hush, or exact financial ruin upon someone.

    How long will MS keep paying what looks to be hush money to make problems go away before someone notices that they are not chaging?

    That is, of course, only one issue...i'm worried about what nberardi is worried about: at what point will legit suits against MS get tossed out because it looks/smells like another "let's hit MS's deep pockets" suit?

  19. Re:Only 1 million consumers in minnesota? by DaHat · · Score: 2, Funny

    You've never been to the Minneapolis area have you?

  20. Re:heh.... by molarmass192 · · Score: 2, Interesting

    The only problem is that there's no law on the books to allow this kinda thing. What we need-ED was for the anti-trust trial do what it was supposed to do and break the company up like they did AT&T. There's still the "regulate-it-to-death" approach remaining: create an FTC-like oversight body for operating system software that would force MS to open up their software. This could create a market for resellers and even competing flavors of Windows. The only problem is that the OS business would become a tangled bureaucratic mess like the communications business now is.

    Personally, I'd rather the govt keep MS's bundling activities in check and let the competition invade MS's core business horizontally, at least until some kind of a competitive balance is restored. Would MS kick and scream? Of course, this is a measure designed to reduce their market share, the exact opposite of their end-all-be-all goal.

    --

    Good people do not need laws to tell them to act responsibly, while bad people will find a way around the laws-Plato
  21. The settlement by Anonymous Coward · · Score: 5, Funny

    Microsoft will give Minnesota 700,000 copies of Microsoft Bob.

  22. Re:Only 1 million consumers in minnesota? by -kertrats- · · Score: 2, Informative

    With only 4 million people TOTAL up here, thats normal enough.

    --
    The Braying and Neighing of Barnyard Animals Follows.
  23. Re:Settled, eh? by Goobermunch · · Score: 5, Insightful

    Actually, most settlement agreements have a disclaimer of liability (not guilt, this wasn't a criminal trial). If this had gone to the jury and an actual verdict been issued, then the court may have had the ability to set up a situation where further improper conduct on MSFT's part would have resulted in contemp citations.

    Yet another reason why MSFT benefits from settling.

    --AC

  24. Re:Other Sources (Local Sources) by BenFranske · · Score: 2, Informative

    Or try reading about it in the local paper the StarTribune story.

  25. Not Paid in Cash? by Marnhinn · · Score: 2, Interesting

    You're right. It does not specify that it will be paid in cash, but one would assume so for several reasons:

    1. Other recent lawsuit actions. MS recently settled 2 other lawsuits for a total of 2.04 billion dollars [1.6 billion Sun, 440 million Intertrust]
    2. Non-Cash Settlements have hurt MS. When MS settled with the DoJ and some states in November, provisions in the settlement prevented MS from engaging in exclusive contracts that would prohibit software developers or PC makers from using competing products [source - news.com].
    3. Settlements with some states have been for software and like, but some [for example California which settled for 1.1 billion], the money is available to claim if you want (a cash settlement).

    I would bet the settlement with be for a decent amount of cash, but you have to claim it and the unclaimed Cash goes back to MS [like California and Florida's settlements.

    --
    There is always a frontier where there is an open and willing mind
  26. Re:Sigh by strictnein · · Score: 2, Funny

    Fargo is in North Dakota. You betcha.

  27. "It doesn't matter" -- B. Gates by kclittle · · Score: 3, Insightful
    "You don't get it. It doesn't matter".

    Supposedly this was Gates rejoinder to Steve Jobs when the latter said, "We're better than you." Gates knows in this case that throwing a bit of cash to Minnesota to settle the suit doesn't really matter, either. It's the same Machiavellian insight as to what it takes to win his grand strategic goals at the cost of a few tactical losses. "Oh, I over charged you for the years between 1994 and 2001? So sorry. Here's a 30% refund in 2004. Thanks for the 70% I get to keep! (And the time I needed to eliminate my competition, hehe...)".

    --
    Generally, bash is superior to python in those environments where python is not installed.
  28. Redefinitions by t_allardyce · · Score: 4, Interesting

    Where settlement, read 'Microsoft agrees to give away some of its products (which it will claim are worth a total of severl billion dollars when really its plastic and amounts to potential lost sales) to schools where it hopes to lock in students at an early age (i.e those lost sales are actually an investment at Microsofts advantage).' - for example whats better: give 10,000 copies of office to schools as part of a settlement, or give 10,000 copies of OpenOffice (essentially identical) to schools and Microsoft can give a sum of money to someone else?

    --
    This comment does not represent the views or opinions of the user.
  29. Still waiting to receive my settle... by wtoconnor · · Score: 4, Interesting

    I don't know about anyone else but I still have not received my CA settlement money. Paper work I sent in almost six months ago has not produced a check. I guess we have to bring up a lawsuit to get then to pay the money they already own us from the previous law suit.

  30. Re:How is Windows overpriced? by justMichael · · Score: 2, Insightful

    Where can you get a FULL, non-upgrade, non-OEM copy of XP for less than $100?