A $1.25 million reimbursement under the federal eRate program is the property of the school system that applied for the funding and not the creditors for the now-bankrupt company that performed the wiring service, the U.S. Supreme Court has decided.

The High Court's Dec. 1 ruling ends a two-year legal fight over who should retain eRate funds in the event that a service provider declares bankruptcy before receiving any money through the program, which provides discounts on telecommunications services to eligible schools and libraries.

The Springfield, Mass., public school system--one...

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