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Microsoft countersues Sun Micro

Microsoft lashes back at Sun Microsystems over a breach-of-contract suit Sun filed earlier this month.

Microsoft (MSFT) today lashed back at Sun Microsystems (SUNW) over a breach-of-contract suit Sun filed earlier this month.

In its 35-page response, Microsoft denied Sun's claims and countersued Sun Jousting over Java, charging breach of contract, breach of the covenant of good faith and fair dealing, and unfair competition. The software giant said Sun repeatedly failed to live up to its obligations under an agreement the two companies forged on March 11, 1996.

"What happened today, from our viewpoint, is standard operating procedure. You might even call it garden-variety legal action," said Ann Little, a Sun spokeswoman. "This wasn't anything that we didn't expect."

Earlier this month, Sun sued Microsoft for breach of contract over its obligation to deliver a compatible implementation of Java technology in its products. Sun claimed Microsoft left out portions of its Java technology, and alleges that programmers using Microsoft's flavor of Java will not be able to develop applications that will work easily on all platforms. That, in turn, could jeopardize Sun's stance that Java will allow programmers to write their applications once and have them run anywhere.

The countersuit specifies that Sun failed to deliver technology that passes Sun's own test suites and that runs on the Microsoft Reference implementation. The suit also says Sun did not provide a public set of test suites, as required by the agreement.

Microsoft alleges intentional interference with prospective advantage in the suit. It also alleges unfair business practices for repeated false statements about the compatibility and desirability of Microsoft's products and Microsoft's rights under the agreement.

"Sun has made statements about the desirability of our product and the nature of the relationship that are simply are false," said Charles Fitzgerald, a Microsoft group program manager. "We need to clear that up in both the marketplace and the legal arena."

He contended that Sun has changed its business goals since Microsoft signed its Java licensing deal 18 months ago.

"Sun's ambitions got much broader--they wanted to create a middleware operating layer," Fitzgerald said.

Fitzgerald contends that Microsoft's Java license required it to include only technology in Sun's Java Developer Kit version 1.02 and only in the 3.0 version of Microsoft's Web browser, Internet Explorer. Specifically, he said the license doesn't require Microsoft to ship Java at all in IE version 4.0, which is the specific point of contention between Sun and Microsoft.

"We can literally go cherry-pick what Sun technologies we want," he added. "From a product standpoint, we can exclude Java if we want to."

Sun said it is seeking $35 million plus compensatory damages and attorneys fees in its lawsuit against Microsoft over the software giant's Java license.

The suit, filed in U.S. District Court in San Jose, California, charges Microsoft with trademark infringement, false advertising, breach of contract, and unfair competition.

Sun's claim emerged in an amended legal complaint that the company filed one day after the filing of the initial complaint. Sun posted the complaint on its JavaSoft site, along with copies of Microsoft's Java licensing agreements.

The contracts include both a technology license and a trademark license, both of which are posted. They indicate that Microsoft is paying Sun $3.5 million a year to license Java under the now-disputed five-year deal.