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Gates on Witness List in Iowa Antitrust Suit

One of the last remaining consumer class-action antitrust lawsuits filed against Microsoft Corp. in a state court is set to go to trial in November, and Bill Gates is on the witness list.

One of the last remaining consumer class-action antitrust lawsuits filed against Microsoft Corp. in a state court is set to go to trial in November, and the company's co-founder and chairman is on the witness list to testify.

That doesn't mean Bill Gates will end up in the witness chair in Polk County District Court defending his company's business plan, but it's a possibility.

The lawsuit against Microsoft has made its way to the Iowa Supreme Court three times and unlike those in most states, which have been either settled or dismissed, it is scheduled for trial on Nov. 13.

Attorneys expect the trial to last six months.

Des Moines attorney Roxanne Conlin said Tuesday her experts have estimated that individuals and businesses have been overcharged as much as $453 million for Microsoft products in the last 12 years because a lack of competition has inflated the cost of the company's products.

In Iowa, about 5.1 million licenses for Microsoft Windows have been issued, 1.8 million for Office, 446,373 for Word and about 21,349 for Excel.

The average consumer overcharge ranges from $10.50 for buyers of Word to $56.99 to those who purchased Excel, Conlin said.

Many customers may have purchased more than one version in 12 years, Conlin said, so they could be eligible for multiples of those amounts.

Conlin said class members include all those who bought the following in Iowa from May 18, 1994, through June 30, 2006: Microsoft Windows, MS-DOS, Word, Excel, or Office software, or a personal computer on which this software was already installed.

"Class members do not have to do anything to be included in the class and there is no cost to be a member of the class," Conlin said.

Customers in Microsoft's database have been notified by mail or e-mail that they are part of the class-action case, Conlin said.

Microsoft denies that consumers were injured and said that computer users have benefited from the company's efforts to improve its products.

"The merits of the case will be determined in a lengthy trial that will begin in November," Microsoft attorney Rich Wallis said Tuesday. "We're looking forward to being in Iowa and having the opportunity to address these claims and defend our business model of selling high quality software at fair and reasonable prices."

One of the reasons Iowa continues to fight Microsoft in court is that Conlin has refused to accept a settlement in which Microsoft would offer vouchers for computer products.

"I don't think Iowans want coupons," she said. "I think if they were charged too much money and that's what a jury decides, then they should get their money back, not a coupon."

The case claims Microsoft violated Iowa's antitrust laws and harmed customers by illegally overcharging for its software, by denying class members free choice in software products and the benefits of software innovation, and by making computers increasingly susceptible to security breaches.

Microsoft initially faced 206 class-action lawsuits across the United States. The company said 108 were consolidated in a federal antitrust case and 96 remained in state courts.

Most were dismissed or settled for vouchers.

Cases in Iowa and Mississippi are among a handful that remain.

District court officials sent a court-ordered notice to known class members in Iowa by mail and e-mail, a required step in class-action cases.

Anyone in the class may chose to exclude themselves from the case but must do so by mail or e-mail by Nov. 13, Conlin said.

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Reader Comments:

Thu, Dec 21, 2006 jeff des moines

Microsoft never innovated anything in its life. Whatever they didn't rip off from another company they simply bought and then passed off as their own. The idea that consumers have free choice is a laugh. If you don't believe me go to best buy and see if they will put linux on your new computer.

The fact is, there was already a trial six years ago and microsoft was found liable for having an illegal monopoly. So the only question now is whether microsoft used that monopoly to charge higher prices. To me that's a no-brainer--what good is a monopoly if you're not going to use it to make more money? But microsoft is going to try to hide the ball and talk about how great it's products are, which just tells you that they did charge more for their products than they would have if they hadn't killed the competition with illegal conduct.

Sun, Sep 17, 2006 Russ Honolulu

The reason the products cost more is because lawyers like Roxanne Conlin are trying to create a living for themselves at the expense of the rest of us. Please engage your brain before opening you mouth. As the other person stated above, the end users can use Linux and OpenOffice. The users could CHOOSE not to buy the Microsoft product. It's really simple. I don't think they should even get a voucher. Come on people, decide what you want, shop around for a good price, buy what you need and want. I guess the same could be held true for cars and potatoes and whatever. Are there products in Iowa that they have a benefit that the rest of can't take advantage of?

Fri, Sep 15, 2006 Dan Pennsylvania, USA

Why is it Microsoft's fault that no one else is selling quality software of in Iowa? Can they just invent competition for themselves? Besides, I'm sure their prices in Iowa are the same as they're charging (within a small margin of difference to account for shipping costs, etc.) everywhere else. Come on guys, you're not winning any victories here by bringing Microsoft to trial on the silly argument that customers are being harmed because they don't have a choice not to use Microsoft products. As far as I know, you can still download Linux, OpenOffice, Firefox and any other free, open source software they want to in Iowa. The same may not be true where consumer's choices are government censored in places like China. But at least for now, if you want to use another companies products you have the right to do so in the good old USA.

Thu, Sep 14, 2006 Anonymous Anonymous

I agree with Microsoft. Consumers have benefitted immensley from the innovation and quality products created by Microsoft. If anything consumers have been illegally benefitting by copying far more software than they have purchased.

Thu, Sep 14, 2006 Anonymous Anonymous

The only people who win here are the lawyers. Consumers will end up getting a dollar or two and Microsoft will make up the difference in raising the price of other products.

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