updated 3/11/2005 7:58:32 PM ET 2005-03-12T00:58:32

Microsoft Corp. will pay $60 million to settle a lawsuit brought by a California software company that alleged Microsoft stole its multimedia streaming software.

Microsoft and Burst.com said in a joint statement late Friday that they had reached “an agreement in principle” to resolve all claims against Microsoft. Under the settlement, Microsoft also will receive a non-exclusive license to Burst’s patent portfolio.

“While we were confident of prevailing in this lawsuit, we have been open from the beginning to finding a reasonable way to resolve this case,” Tom Burt, Microsoft’s deputy general counsel, said in the statement.

Burst Chief Executive Richard Lang said in a statement late Friday that Microsoft’s decision to license the product “validates the innovation of the Burst technology.” Resolving the litigation will allow Burst to focus on other opportunities, Lang said.

A court hearing scheduled for Friday in Baltimore, where the Burst case and others involving Microsoft have been consolidated for pretrial matters under U.S. District Court Judge J. Frederick Motz, was canceled, according to Burst’s Web site.

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Microsoft has settled several antitrust lawsuits in recent years, including cases filed by the U.S. government and several states over its use of the Windows operating system to muscle out rivals, including competitors to its Web browser.

Over the past two years, Microsoft has spent some $3 billion to settle private antitrust lawsuits filed by AOL Time Warner Inc., Sun Microsystems Inc., Be Inc. and Novell Inc. It also paid an undisclosed amount to a trade group that had backed antitrust complaints by the U.S. government and the European Union.

The Novell settlement relates to antitrust claims regarding its NetWare product. Less than a week after reaching that deal, Novell filed a lawsuit regarding WordPerfect, a product Novell used to own. Microsoft also faces complaints from RealNetworks Inc. and the EU.

Burst, based in Santa Rosa, Calif., sued Microsoft in June 2002, alleging Microsoft developed its own software for streaming audio and video more quickly over the Internet after discussing the technology for months with Burst.

Redmond, Wash.-based Microsoft says it did nothing wrong.

In October, Burst filed a motion in Baltimore saying Microsoft developed policies to destroy internal e-mails and other documents crucial to ongoing lawsuits. The company said Microsoft also destroyed e-mails necessary to Burst’s lawsuit even after a court ordered the company to retain the documents.

Burst, according to the October motion, wanted the jury in the case to be told that Microsoft failed to retain important documents and should therefore infer that the company did so because those documents were damaging.

Microsoft said its e-mail destruction policy didn’t pertain to workers involved in legal proceedings.

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