Microsoft Corp has settled antitrust claims made by International Business Machines Corp, agreeing to pay $775 million to IBM, the companies said on Friday. Under the settlement, which resolves discriminatory pricing and overcharge claims made by IBM against Microsoft, the software maker will extend $75 million in credit toward deployment of Microsoft software at IBM.
In the wake of a landmark antitrust settlement with the US government, Microsoft has settled outstanding antitrust complaints with a variety of litigants ranging from states to companies large and small.
Last year it agreed to pay $2 billion to Sun Microsystems Inc In April, it paid Gateway Inc $150 million. Microsoft has yet to resolve outstanding claims by RealNetworks Inc and one with Novell Inc.
"This is significant step toward our efforts to resolve these issues with other companies," said Brad Smith, general counsel and senior vice president at Microsoft.
Smith said the agreement was reached late Thursday, the last day of the fiscal quarter, and said Microsoft will detail the financial effects of the settlement on the company later this month.
Still outstanding is IBM's claim that Microsoft's market dominance harmed its server hardware and server software business. IBM agreed that it will not assert claims for server monetary damages for two years and will not seek to recover damages on such claims incurred prior to June 30, 2002.
The $775 million settlement will result in an undetermined one-time gain that IBM plans to take in the second quarter, ended Thursday, the same day the settlement was signed. "This is a nonrecurring second-quarter event," IBM spokesman Scott Brooks said. He declined to comment on other factors influencing the company's second-quarter results.
The Microsoft settlement gain will join a variety of other one-time gains and charges in IBM's second quarter. IBM has said it plans to take a gain of roughly $1 billion on the sale of its PC business to Lenovo Group Ltd of China.
IBM will record restructuring charges to cover the costs of cutting up to 13,000 jobs, or 4 percent of its work force.
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