U.S. District Court Judge James Ware rejected Microsoft's arguments that a trial in San Jose, Calif., would take longer, inconvenience the company and force it to face a more hostile jury. Microsoft had requested that the trial be moved to Seattle.
"The court finds that a transfer would not serve (the interests of convenience or justice) any more than having the case proceed here," Ware wrote.
Streaming media provider RealNetworks filed a civil suit against Microsoft in December, seeking more than $1 billion in damages from the company on charges that it illegally used its Windows monopoly to hurt digital media rivals.
RealNetworks' suit, filed in federal court in San Jose, alleges that Microsoft has "pursued a broad course of predatory conduct over a period of years...resulting in substantial lost revenue and business for RealNetworks."
Microsoft in recent weeks the charges in a 31-page legal filing. The Redmond, Wash.-based company argues that RealNetworks has suffered no injury as a result of its conduct, which it defended as "permissible competitive activity."
Microsoft, which makes Windows Media Player, added that there is little evidence of slackening competition in the digital media market.
The software giant could not be immediately reached for comment on the judge's motion.
RealNetworks spokesman Greg Chimengo welcomed the decision. "We look forward to presenting our case to a jury in San Jose, where key third-party witnesses can give important testimony in person."
Earlier this week, RealNetworks, claiming the league violated a contract that required it to use the streaming media company's software. It is seeking a temporary restraining order in U.S. District Court to compel MLBAM, a division of Major League Baseball, to use its formats.