U.S. District Judge Ronald Whyte rejected Microsoft's request for summary judgement regarding the independent development of Java, Microsoft said. Whyte also dismissed a Sun counter motion.
The judge denied both motions, stating that the issue will have to be determined at trial as both sides offered plausible interpretations of the contract, according to the software giant. There are still eight other summary judgments pending in the case, and no trial date has been set.
"While we are disappointed not to reach early resolution on this issue, we are confident that Sun's efforts to prevent Microsoft, and by extension any other company, from independently developing Java solutions will fail," Microsoft spokesman Jim Cullinan said in a statement.
In a prepared statement, a Sun representative said, "Sun is confident that it will prevail on this matter at trial."
The decision comes as Microsoft is battling legal challenges on another, higher-profile front. The Justice Department and 19 states recently completed final arguments in the landmark antitrust trial.
Microsoft licensed Java from Sun in 1995 and has since built its own runtime environment, or virtual machine, for use in its Windows operating systems and its Internet Explorer Web browser. Microsoft also sells Visual J++, a Java development tool.
Sun says not only that the Microsoft Virtual Machine is incompatible with Sun's reference implementation of Java, but also that it causes developers to build Java programs that only operate on Microsoft's Windows, defeating Sun's "write once, run anywhere" goal and violating the letter of Sun's Java licensing agreement.
Java, touted for its portability, lets software developers create programs that will run on virtually any operating system, such as Windows or Unix. Conformity is a big issue, Sun argues, if Java is to be ubiquitous.
Sun sued Microsoft in October 1997, alleging the maker of Windows violated its contract with Sun for developing and deploying products using the Java programming language and also Sun's Java copyright.
The protracted lawsuit has prevented Microsoft from updating its popular Java software development tool, Visual J++ 6.0, in more than 18 months allowing rival software makers, such as IBM, Corel's Inprise, BEA Systems' Symantec and others to surpass Microsoft with new features.