Microsoft settles Internet Explorer lawsuit

Microsoft has avoided a costly court battle over its right to use the term "Internet Explorer" as the trademark of its Web Browser. SyNet, the now-defunct software company which had previously registered the term and released product under the name, agreed to settle out of court for $5m (£3.1m).

The Patent and Trademark office at first allowed Microsoft to use the term, but subsequently reversed its decision. SyNet founder, Dirhen Rana, accused Microsoft of forcing his company into bankruptcy, and has seen most of the settlement fee go to creditors and lawyers. He is now working for Netscape.

Microsoft claims the settlement vindicates its argument that Internet Explorer is a generic term and cannot be trademarked. The company maintains that it was open to resolving the issue without resorting to litigation from the start. "It appears events in court helped achieve a settlement which is in the best interest of all parties," said a company spokeswoman.

John Moroney, Ovum's principal consultant for new media, disputed Microsoft's claim. He said: "Microsoft got dragged into court again. It probably had to pay its own legal fees and is looking at a loss in excess of what it paid out to settle."

Neither is Moroney sympathetic with Rana's case. "It sounds as if SyNet's claim was not rock solid. It may not be fair, but that's life," he said.