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ANTITRUST Microsoft to pay $1.1B to settle California claims San Francisco (AP)-A judge granted final approval on July 7 in a $1.1 billion settlement between Microsoft Corp. and California consumers who accused the software giant of violating state antitrust and unfair competition laws. California Superior Court Judge Paul H. Alvarado said the settlement amounted to “fair, reasonable and adequate compensation” for more than 14 million eligible consumers. In his order, Alvarado dismissed all objections to the settlement, which was reached in January 2003-less than a month before the case was scheduled to go to court. The settlement stems from a class action filed in 1999 on behalf of California consumers and businesses that bought Microsoft’s operating system, productivity suite, spreadsheet or word-processing software between February 1995 and December 2001. According to the settlement, Microsoft must distribute up to $1.1 billion in the form of vouchers redeemable for computers and software products. Similar class actions were filed in at least 16 other states. They are separate from the antitrust case that Microsoft settled in 2002 with the U.S. Justice Department and several states. The final cost of the settlement depends on the number of consumers who file claims during a 75-day period. ERISA MCI to pay $51M to settle retirement account suits Ashburn, Va. (AP)-MCI Inc. and 18 former executives have agreed to pay as much as $51 million to settle suits filed by workers whose retirement accounts lost billions of dollars after an accounting scandal caused the price of stock in the company, formerly known as WorldCom Inc., to plummet. Under the agreement, MCI and its insurers will contribute nearly $46.8 million to a fund for about 50,000 employees whose retirement plans lost money, spokeswoman Brittany Hoff said. The balance will be paid by former executives, including ex-CEO Bernard Ebbers. MCI is the nation’s No. 2 long-distance company, after AT&T Corp. Stock in MCI plummeted in 2002 after it revealed an $11 billion accounting fraud that led the company to file for bankruptcy that year. The company emerged from Chapter 11 protection earlier this year. The settlement, filed on July 6 in New York federal court, covers anyone who participated in WorldCom’s 401(k) retirement plan from Sept. 18, 1998, through July 21, 2002, Hoff said. The settlement must be approved by the court. The scandal nearly wiped out the retirement savings of many MCI employees, who owned as many as 46 million shares of stock before it filed for bankruptcy. The settlement must be approved by District Judge Denise L. Cote in New York. LEGAL PROFESSION Malpractice suit against firm yields $4.4M award A law firm in Philadelphia was hit with a verdict of more than $4.4 million in a legal malpractice case after a Philadelphia common pleas judge concluded that the firm had provided a false opinion letter to a bank prior to the closing of a $7.3 million loan. At the close of a nonjury trial, Judge Gene D. Cohen ruled that Abrahams Lowenstein & Bushman should also have to pay punitive damages because the conduct of the firm’s lawyers was “reckless” and “outrageous.” Cohen said that he was “particularly disturbed” that the firm had supplied the bank with an opinion letter that was “false at the time it was signed” and that the lawyers “knew it to be false.” The verdict is a victory for law firm Spector Gadon & Rosen of Philadelphia. — American Lawyer Media RACIAL DISCRIMINATION Firm’s settlement entails work practice changes Birmingham, Ala. (AP)-U.S. Pipe & Foundry Co. will pay $6.5 million and change work procedures to settle a lawsuit filed by the company’s black employees alleging discrimination on the job. The Birmingham-based firm has agreed to create a fairness advisory council and to train supervisors not to discriminate. The settlement stems from a December 2000 suit filed in a Birmingham federal court. It was amended to include employees at other plants in Alabama, Tennessee and New Jersey. The employees will share $4.5 million of the settlement. Attorneys for the employees will be paid about $2 million. The agreement covers all current and former black employees of the company’s plants in three Alabama cities and factories in Tennessee and New Jersey. SECURITIES Enron underwriter OKs $69M deal with U. Calif. Berkeley, Calif. (AP)-The University of California (UC), lead plaintiff in a slew of lawsuits filed in the wake of the Enron debacle, has said that it has reached a significant settlement in the case. Bank of America Corp. has agreed to pay $69 million to settle a class action brought against the bank by Enron Corp. shareholders. The bank was sued in its capacity as underwriter for some Enron and Enron-related debt offerings. The settlement will be shared among the thousands of institutional and individual investors. According to William S. Lerach of Lerach Coughlin Stoia & Robbins, lead counsel for UC, the settlement will be the precursor of much larger ones with other banks. UC is the lead plaintiff representing a class of Enron investors who say they lost billions of dollars.

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