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Microsoft filed suit against Lindows in December 2001, charging that the Lindows name infringed on Microsoft's Windows trademark. Lindows.com has argued that "windows" is a generic term for graphical software interfaces.
Lindows.com sells a Linux-based operating system, LindowsOS, intended to compete with Microsoft's Windows OS at the low end of the market.
Microsoft initially sought to have Lindows.com barred from using the Lindows term while the case was being decided. The court rejected that request, after which Lindows.com filed for summary judgment.
Both Lindows.com and Microsoft have presented significant evidence arguing their respective sides of the trademark issue. The court rejected the summary-judgment motion because there was a "genuine issue of material fact regarding the genericness of the Windows mark".
Lindows.com was disappointed by the denial of its motion, but heartened by the court's rejection of some of Microsoft arguments, said Lindows.com chief executive officer Michael Robertson.
Microsoft hailed the court's refusal to rule the Windows trademark generic, and said it is ready to head to trial.
"For the last 20 years, Microsoft has built Windows into one of the most recognisable brands in the world, and we don't think Lindows should be allowed a free ride on our investment," said spokesman Jon Murchinson.