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Federal courts have struggled for decades to find a more efficient way to resolve nationwide litigation. One need only glance at the gusher of asbestos litigation for a reminder of how the legal system can be overwhelmed. In the Microsoft consumer antitrust cases, Baltimore federal district Judge J. Frederick Motz has expressed his desire to wrap up all related litigation against the software giant in one package. And that includes state cases that aren’t before his court, despite howls of protest from the California lawyers. In 1997 the U.S. Supreme Court outlined the analysis courts need to follow when reviewing class action settlements that would extinguish claims of plaintiffs with differing interests. In Amchem Products Inc. v. George Windsor, the court rejected a proposed global settlement of certain asbestos claims that covered not only persons with asbestos injuries from work activities, but all persons who were exposed to asbestos on the job and might discover injuries later. The high court reasoned that the interests of persons who weren’t yet aware of injuries, who were not separately represented, differed too much from the interests of the injured. As a result, class counsel had a conflict representing both. “The settling parties, in sum, achieved a global compromise with no structural assurance of fair and adequate representation for the diverse groups and individuals affected,” Justice Ruth Bader Ginsburg wrote. The problem was compounded because many future claimants couldn’t opt out, given that they didn’t know whether they might later have a claim. The California plaintiffs’ lawyers argue that Amchem bars a global settlement in the Microsoft case because their clients’ interests differ significantly from those of the federal plaintiffs, who have a weaker case, and because they were not adequately represented in the negotiations. Microsoft counters that the difference in the cases is “relatively small.” Even though the federal plaintiffs’ damage claims have been dismissed, and those of the California plaintiffs remain intact, Microsoft maintains that the California case has so many defects that it’s not much stronger than the federal case. Microsoft also points out that, in contrast to Amchem plaintiffs, dissatisfied claimants can opt out. Another basic procedural issue raised in this litigation is whether a federal court can approve a settlement that earmarks all proceeds for a worthy educational foundation, instead of returning any money to plaintiffs. Courts have approved such cy pres settlements when a distribution to class members is impractical because administrative costs would consume the recovery or because class members can’t be identified. Class actions brought on behalf of purchasers of tennis shoes and toys have been settled this way, for example. The California plaintiffs argue that a distribution to Microsoft consumers isn’t impractical. Most register their software with the company and can be identified. And this isn’t a case where the consumers’ recovery is too small to make it worth administering. Roughly 85 percent of the plaintiffs are businesses with multiple licenses, they say, entitling them to checks stretching into the thousands of dollars. Furthermore, they point out, the money belongs to their clients and can’t be donated without their consent, no matter how worthy the cause.

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