An court has reversed a lower court's ruling that Microsoft must distribute a version of Java endorsed by Sun Microsystems.
But the appeals court also said that Microsoft had violated Sun's copyright by distributing its own version of the Java programming language with its products.
Both companies claimed victory after the Court of Appeals announced its decision, another step in Sun's private antitrust lawsuit against Microsoft, which is scheduled to go to trial in 2005.
Appeals court judge Paul Niemeyer said that the previous ruling requiring Microsoft to carry the Sun-compatible version of Java with its operating systems and browser products was a mistake because there was no proof that Sun would suffer "immediate irreparable harm" without the order.
Sun argued that Microsoft, by distributing a version of Java incompatible with the one developed by Sun, had attempted to create confusion over Java and drive programmers to its own .net internet-enabled programming platform.
But Niemeyer questioned the connection between the middleware and PC operating systems markets.
"The mandatory preliminary injunction aimed at prevention 'distortion' in the new emerging market for middleware has not been linked in fact or by any established legal theory to the final relief that Sun seeks in its claim that Microsoft has illegally maintained its monopoly in the market for worldwide licensing of Intel-compatible PC operating systems," Niemeyer said.
The appeals court did uphold the order prohibiting Microsoft from distributing any version of Java other than one allowed by Sun in a 2001 licence given to Microsoft.
Microsoft spokesman Jim Desler called the ruling a "positive step", saying the must-carry Java order was the key issue that needed to be resolved by the appeals court. As for the copyright infringement order, Microsoft already complied in February by replacing the service pack Windows XP SP1 with one excluding Microsoft's Java virtual machine.
"We have continued throughout the past year to resolve conflicts, work with others in the industry and focus on the future," Desler said.
Sun officials said they are exploring their options on the must-carry Java decision. The company could ask for a rehearing or ask for a reissue of the order. Sun may also decide not to press the must-carry order because of announcements earlier this month that Dell Computer and Hewlett-Packard will begin carrying Sun's version of Java on their computer systems, said Lee Patch, Sun's vice-president for legal affairs.
Patch and Rich Green, Sun's vice-president of developer platforms, called the appeals court ruling on the copyright infringement important to the Java developer community because it ends the confusion between the Sun and Microsoft versions of Java that were previously distributed. Original equipment manufacturers now do not have to choose between the two companies' versions of Java, Green said.
PC manufacturers realised they would not get Java from Microsoft anymore and, as a result of the ruling, have come directly to Sun so PC customers can continue to run Java programs on their computers, Green said
"This decision confirms that Microsoft violated our prior settlement agreement, and that it did so in a way that continued to fragment the Java platform on PCs," Patch said.
"While we are disappointed with the delay that results from the court's determination to vacate and remand the must-carry preliminary injunction, the court accepted the district court's determination that Microsoft engaged in anticompetitive acts."
Grant Gross writes for IDG News Service