Law & Courts

Microsoft’s Technology-Giveaway Plan Rejected

By Andrew Trotter — January 23, 2002 3 min read
  • Save to favorites
  • Print

A federal district judge in Baltimore has found significant flaws in a Microsoft Corp. proposal to funnel more than a billion dollars worth of software, reconditioned computers, and technology training to about 14,000 needy schools around the country.

Yet even though he rejected the plan, which was the company’s attempt to settle more than 100 private antitrust lawsuits filed against it, Judge J. Frederick Motz seemed to accept the proposal’s fundamental premise. He said he would allow Microsoft, and a group of lawyers suing the software giant, another chance to bring a revised settlement proposal to the court. Both sides said they would explore that option.

“The judge’s opinion offers a number of different approaches we are thinking about, and we are considering those,” Tom Burt, Microsoft’s deputy general counsel for litigation, said in a conference call with reporters after the Jan. 11 ruling.

The plan, first unveiled in November, would have ended all of the private antitrust lawsuits alleging that millions of consumers have been overcharged for Microsoft software. Courts sometimes allow class-action cases like these to be settled to serve a social purpose—such as supporting education—when it is impractical to identify the individuals who may be entitled to damages, lawyers say.

These private cases are separate from the antitrust litigation against the company initiated by the U.S. government and 18 states and the District of Columbia.

Under the rejected proposal, Microsoft would have paid for the creation of a new charitable foundation that would have distributed technology and training to about 14,000 schools over five years. (“Microsoft Deal Calls for $1 Billion School Effort,” Nov. 28, 2001.) Microsoft would have provided up to $400 million for the foundation to disburse, plus $80 million to support a program run by Microsoft to refurbish used computers, load them with software, and give them to schools. The company would also have provided as much as $1 billion in software, a value based on the products’ discounted price for the school market.

Other software companies had vigorously opposed the plan, saying it would flood the schools with free Microsoft products, which would hurt sales by smaller software-makers. And Apple Computer Inc. argued that its business would be harmed by the refurbished computers, because most of them would not be Apple machines.

Criticism of the Plan

State and local school leaders also criticized the limited role that the plan gave them in making decisions about the kinds of technology that it would make available to their schools.

Although educators praised the goal of directing technology into low-income schools, many rejected Microsoft’s claim that the proposal would not favor the use of certain brands of computers and software vendors, said Glenn M. Kleiman, the vice president of the Education Development Center Inc., a nonprofit education research organization based in Newton, Mass. Mr. Kleiman wrote a letter to Judge Motz signed by 56 educational technology experts and advocates outlining objections to the plan.

Microsoft and the plaintiffs’ lawyers made changes to try to allay those concerns, but the judge wrote in a ruling on Jan. 11 “that the charitable foundation contemplated by the agreement is not sufficiently funded” to meet its goal of benefiting society and to ensure that the program “would not have anti-competitive effects.”

The judge seemed to have been swayed by the arguments of educational technology officials. “It did look to me like the judge certainly understood the issues,” said Helen Soulé, who is Mississippi’s educational technology director, and who signed the letter sent by Mr. Kleiman to Judge Motz.

Mr. Kleiman said that even if the settlement had been approved, it would likely have faced legal challenges by some dissenting plaintiffs.

Related Tags:

A version of this article appeared in the January 23, 2002 edition of Education Week as Microsoft’s Technology-Giveaway Plan Rejected

Events

Special Education Live Online Discussion A Seat at the Table - Special Education: Proven Interventions for Academic Success
Special education should be a launchpad, not a label. Join the conversation on how schools can better support ALL students.
Special Education K-12 Essentials Forum Innovative Approaches to Special Education
Join this free virtual event to explore innovations in the evolving landscape of special education.
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Curriculum Webinar
STEM Fusion: Empowering K-12 Education through Interdisciplinary Integration
Join our webinar to learn how integrating STEM with other subjects can revolutionize K-12 education & prepare students for the future.
Content provided by Project Lead The Way

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

Law & Courts Title IX Rule to Protect LGBTQ+ Students Temporarily Blocked in 4 States
A federal judge in Louisiana delivered the first legal blow to the Biden administration's interpretation of Title IX.
4 min read
Demonstrators advocating for transgender rights and healthcare stand outside of the Ohio Statehouse on Jan. 24, 2024, in Columbus, Ohio. Republican states are filing a barrage of legal challenges against the Biden administration's newly expanded campus sexual assault rules, saying they overstep the president's authority and undermine the Title IX anti-discrimination law.
Demonstrators advocating for transgender rights and health care stand outside of the Ohio Statehouse on Jan. 24, 2024, in Columbus, Ohio. Republican states have filed a barrage of legal challenges against the Biden administration's new Title IX rule, and one of them has just resulted in a temporary order blocking the rule in four states.
Patrick Orsagos/AP
Law & Courts Judge Strikes Down Title IX Guidance on LGBTQ+ Students. Here's Why It Matters
In a June 11 ruling, Texas judge said the Education Department has no authority to expand protections under Title IX.
8 min read
Texas Attorney General Ken Paxton speaks at a news conference in Dallas on June 22, 2017.
Texas Attorney General Ken Paxton speaks at a news conference in Dallas on June 22, 2017. His office sued the Biden administration in an attempt to invalidate guidance it released in June 2021 stating it would interpret Title IX to prohibit discrimination based on sexual orientation and gender identity.
Tony Gutierrez/AP
Law & Courts Court Backs School That Barred Student's 'Two Genders' Shirt
The court said the shirt could be understood to demean transgender and gender-nonconforming students, and administrators could prohibit it.
5 min read
ADF Senior Counsel and Vice President of U.S. Litigation David Cortman, left, and Liam Morrison speak at a press conference following oral arguments before the U.S. Court of Appeals for the 1st Circuit on Feb. 8, 2024.
David Cortman, senior counsel and vice president of Alliance Defending Freedom, left, and middle school student Liam Morrison speak to reporters following oral arguments over Morrison's "There Are Only Two Genders" T-shirt before the U.S. Court of Appeals for the 1st Circuit in Boston on Feb. 8, 2024.
Courtesy of Alliance Defending Freedom
Law & Courts Federal Judge Overturns New Hampshire Law on Teaching 'Divisive Concepts'
The judge holds that the law is unconstitutionally vague because it does not make clear to educators what topics they may not teach.
4 min read
Students walk into the front doors at Hinsdale Middle High School, in Hinsdale, N.H., on the first day of school on Aug. 30, 2022.
Students walk into Hinsdale Middle High School, in Hinsdale, N.H., in August 2022. A federal judge has struck down a New Hampshire law that bars the teaching of "divisive concepts" to K-12 students.
Kristopher Radder/The Brattleboro Reformer via AP