Microsoft pays nearly £11m to end Lindows battle

Microsoft Corp. has agreed to pay Linux vendor Lindows Inc. US$20 million to end a two-and-a-half-year legal battle over the...

Microsoft has agreed to pay Linux vendor Lindows £10.78m to end a two-and-a-half-year legal battle over the Lindows name, which Microsoft argues is too close to its Windows trademark.

As part of the settlement, Lindows agreed to change its legal name to Linspire by 14 September and cease all use of the Lindows name in its products. The San Diego-based company adopted the Linspire name for most of its products sold globally and for its website in April, after a legal defeat in Europe.

Additionally, Lindows will hand over several internet domain names it registered, including and However, the company will be allowed to hold on to the and names until 15 July, 2008. The names will redirect to the Linspire website.

Microsoft has fought Lindows over the similarity between the Windows and Lindows names. Microsoft first sued in the US in December 2001. The US suit was followed by legal action in Canada, Finland, Sweden, the Netherlands, France and Spain. The settlement ends all these matters, according to the Lindows filing.

While Microsoft has had some success in courts outside the US, it lost two requests for an injunction in a Seattle court. Furthermore, a federal appeals court in May declined Microsoft's request to review a key pretrial ruling against the company. As a result, a jury reviewing the US case would have been instructed to consider whether "windows" was a generic term before Microsoft introduced software with that name in 1985.

The SEC filing also revealed terms for Lindows' planned initial public offering. The company, which has yet to turn a profit, plans to offer 4.4 million shares at a price of £5 to £6 a share and is seeking a listing on the Nasdaq under the symbol "LINE".

Joris Evers writes for IDG News Service

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