Microsoft officials were elated when the Supreme Court sent the landmark antitrust case back to the appeals court, which in the past has favored Microsoft.

But this victory overshadows an underreported loss the company is suffering on a different front. A San Francisco judge has opened the door to the first consumer lawsuit against Microsoft—a triumph for lawyers who will be the prime beneficiaries of these cases.

Roughly 140 consumer lawsuits have been filed against Microsoft nationwide. Until the August 29 ruling by San Francisco Superior Court Judge Stuart R. Pollak, the company had a perfect record in getting cases dismissed.

Trial attorneys will undoubtedly use the judge’s ruling as ammunition to push other class-action suits against the company through the courts. Attorneys behind the California class-action case claim the software giant has used its dominant market position to bilk California consumers of countless dollars for products, including the Windows operating system, and Word and Excel software programs.

But as Pollak himself suggested, it will be a difficult task for attorneys to demonstrate how Microsoft wronged consumers. Microsoft may be tempted to offer a settlement to avoid the risk of an inflated jury award, just as Toshiba did last year when attorneys confronted the company with a suit over allegedly defective floppy disks.

But California consumers should not await a check in the mail from Microsoft. Experts say the company is more likely to settle the lawsuits with coupons—the latest trend in class-action suits.

In that scenario, consumers could use the coupons to offset the cost of a Microsoft product. But few consumer litigants end up redeeming their coupons, particularly when they have to complete complicated paperwork in order to get the rebate.

For example, the record shows that in a settlement with the loan company ITT Financial, only two of 96,754 people used the coupons sent to them for $ 29 toward a membership in the company’s hotel and airline discount club.

Lawyers, however, do not have such problems. They get paid in hard cash, usually 10 percent to 15 percent of the total value of the coupons. The lawyers in the Microsoft case will probably say the price of Windows is at least $ 40 too high, as the Justice Department also claims. Triple punitive damages—the rule in antitrust class-action suits—would bring the coupon to $ 120.

If one million people are certified in the California suit, the damages will amount to $ 120 million. A case that settles at 50 cents on the dollar would bring the figure to $ 60 million, sending at least $ 6 million to the plaintiffs’ lawyers and a bunch of coupons to consumers.

It’s difficult to imagine how the case would benefit consumers. Consider the outcome of the billion-dollar tobacco settlement between the 46 states and the major cigarette companies. Smokers today are paying an average of $ 2.81 for a pack of cigarettes, a 37-percent rise in price since the settlement was made in late 1998.

Smokers won’t receive any monetary compensation under the settlement. The states, however, will collect $ 246 billion over 25 years as reimbursement for the cost of treating smoking-related illnesses.

Since there are no rules on how the money must be spent, states have been earmarking the settlement funds for general funds and a variety of non-health related programs.

A recent report released by the National Conference of State Legislatures reveals that states plan to spend $ 8 billion of the tobacco settlement money within the next year. Less than 10 percent of that figure will be used to fund smoking prevention programs.

While smokers are shelling out more as a result of the settlement, lawyers are cashing in on a vast fortune, upwards of $ 20 billion in legal fees to be paid over the 25-year period.

The fees, which will be split between approximately 100 law firms, are already nearing the $ 10 billion mark. Turning Microsoft into the next Philip Morris will not benefit the economy or consumers. It will only help trial lawyers live a lifestyle more like that of Bill Gates.

Helen Chaney is a public policy fellow in the Center for Freedom and Technology at the California-based Pacific Research Institute for Public Policy. She can be reached via email at hchaney@pacificresearch.org.