Microsoft, Lindows Settle Trademark Dispute

By Matthew Hicks  |  Posted 2004-07-19 Print this article Print

Updated: Microsoft agrees to pay Lindows $20 million, while the maker of a Linux-based competitor to Windows changes its names to Linspire globally.

Microsoft Corp. and Lindows Inc. have reached a $20 million settlement in their ongoing trademark feud, with Lindows agreeing to changes its name globally and Microsoft licensing digital media technology. The settlement, reached on Friday, ends a series of trademark infringement lawsuits that Microsoft had brought against Lindows in which it alleged that the Lindows name was too similar to Microsofts Windows trademark. The two companies announced on Monday that Lindows will change its company name and the name of its Linux-based operating system to Linspire. Lindows previously had changed the name of its OS internationally following initial court rulings against it in the Benelux and other European countries.
Benelux courts more recently ruled that Lindows could sell its products there. Click here to read more.
The companies said that the terms of the settlement were confidential, but a Lindows filing with the Securities and Exchange Commission stated that Microsoft will make two payments to Lindows totaling $20 million. Lindows previously had filed the paperwork for an initial public offering, and on Monday filed an amended S-1 filing. It intends to issue 4.4 million shares at between $9 and $11 a share, which could raise as much as $48.4 million. Microsoft agreed to pay $15 million by Aug. 15, and then make a second payment for $5 million by Feb. 1, 2005, in exchange for Lindows handing over a set of "Lindows" domain names to Microsoft, according to the filing. Microsoft also agreed to grant Lindows a limited, four-year license to unspecified Windows Media components, which Lindows intends to include in its newly renamed Linspire operating system, the filing stated. Microsoft officials, in a statement, said that the settlement addresses the Redmond Wash., companys concerns about its Windows trademark. "We are pleased that Lindows will now compete in the marketplace with a name distinctly its own," said Tom Burt, Microsofts corporate vice president and deputy general counsel, in a statement. While having some luck against Lindows in Europe, Microsoft faced snags in the United States. In February, a federal court ruled that a jury would consider historical uses of "windows" in user interfaces beyond its use in Microsofts operating system. Next Page: Lindows CEO comments on the settlement.

Matthew Hicks As an online reporter for, Matt Hicks covers the fast-changing developments in Internet technologies. His coverage includes the growing field of Web conferencing software and services. With eight years as a business and technology journalist, Matt has gained insight into the market strategies of IT vendors as well as the needs of enterprise IT managers. He joined Ziff Davis in 1999 as a staff writer for the former Strategies section of eWEEK, where he wrote in-depth features about corporate strategies for e-business and enterprise software. In 2002, he moved to the News department at the magazine as a senior writer specializing in coverage of database software and enterprise networking. Later that year Matt started a yearlong fellowship in Washington, DC, after being awarded an American Political Science Association Congressional Fellowship for Journalist. As a fellow, he spent nine months working on policy issues, including technology policy, in for a Member of the U.S. House of Representatives. He rejoined Ziff Davis in August 2003 as a reporter dedicated to online coverage for Along with Web conferencing, he follows search engines, Web browsers, speech technology and the Internet domain-naming system.

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