According to a filing with the Securities and Exchange Commission from San Diego, California-based Lindows, the two companies came to a settlement agreement after Microsoft sent a letter to Lindows alleging that it was distributing Windows Media technology without a license.
The trademark dispute had been ongoing since December 2001 and although Lindows had some success in the US Courts Microsoft gained favorable responses outside the US, forcing Lindows to change its brand to Linspire in order to avoid a heavy fine.
The filing gives no indication if Linspire will now become the global company name, but by September 2004 Lindows will cease to use its current name other than to redirect traffic to its new site. Current Lindows domain names will be assigned to Microsoft in exchange for a total of $20m.
Under the settlement terms Lindows will also cease the distribution of Widows Media Files with its Linspire 4.5 operating system, although it has granted a four-year, royalty-free license with Microsoft for a number of Windows Media components to be distributed with Linspire.
The settlement brings to an end the long-term trade dispute, which at points threatened to cost Microsoft its Windows trademark. The judge hearing the case had questioned whether the word windows is entitled to trademark protection at all. A trial was due to start in the second half of 2004.
