As Microsoft Trial Comes to a Close, Taxpayers’ Wallets Open



For Immediate Release Contact:  Sean Rushton/Mark Carpenter
June 19, 2000 (202) 467-5300

 


(Washington, D.C.) – Throughout the current phase of the Microsoft antitrust trial, Citizens Against Government Waste (CAGW) has been informing taxpayers of the high cost of the continued litigation by nine state attorneys general and the District of Columbia.   Today, CAGW released its latest update estimating the amount of money being risked by the states at taxpayers' expense.  The total amount spent can be tracked through a spending meter located on CAGW's website, www.cagw.org.  At the conclusion of the trial, on behalf of the taxpayers in the nine states and D.C., CAGW will present an invoice to the attorneys general for the final cost.


"Finally, we have reached the point where both parties have made their closing arguments, and all that is left is for the judge to make her decision," CAGW President Tom Schatz said.  "The states have risked a great deal of taxpayer money during this trial if they lose.  Unfortunately, we do not know exactly how much they have risked.  Maybe now taxpayers will find out.  From the beginning, the only ones who were interested in continuing the trial, aside from Microsoft's competitors, were the remaining state attorneys general."


CAGW has repeatedly asked for information regarding the states' expenditures in the case by filing Freedom of Information Act requests with the attorneys general, most recently in January 2002.  The states have either denied the requests or provided incomplete responses.  As a result of the lack of response from the states CAGW estimated the cost of the trial based on information collected from other leading litigation firms in Washington.  The analysis reveals that each day in court costs at least $30,000.  Once pretrial preparation, estimated at $250,000, is factored in the total cost at the end of closing arguments will be $1,420,000.  This figure does not include the hours and money spent preparing for closing arguments and final briefs that totaled around 500 pages, burned onto CD-ROM.


The state of California, facing a budget deficit of $23.6 billion, recently admitted that it was footing the bill for most of the states’ ongoing litigation activities.  The Office of Attorney General Bill Lockyer in California sent a letter to CAGW claiming that as of May 8, they have spent more than $6.9 million, not including attorney hours or travel, on the case in fiscal year 2001-2002, far exceeding CAGW's very conservative estimates.  Last fall, Lockyer estimated that the states had already spent more than $20 million just on its outside lawyers.  There are no legal guarantees that even if the states win their arguments that the judge will force Microsoft to pay all of their fees.


"This is an extraordinary amount of money to be risking when your state budget is facing such a major shortfall," stated Schatz.  "Surely this money could have been better used.  These states, including California, are now even considering tax increases in an effort to break even."


"Throughout the course of the trial, attorneys general have traveled to and from D.C. to watch the trial firsthand, hired high-priced litigators, had staff temporarily move to D.C., and spent thousand of dollars in preparation outside the courtroom.  Meanwhile, it is the taxpayers that would cover these costs if the judge rejects their arguments," concluded Schatz.  "The federal government and nine other states have already settled the case, and so too should the remaining states.  It is time to put the money and resources devoted to this case to where they are really needed."


Citizens Against Government Waste is the nation's largest nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government.


 

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