Microsoft has announced an unexpected about-face which, according to sources, will see it pay $US5 million to settle a trademark dispute over the use of the name Internet Explorer for its flagship Web browser. A Microsoft spokesman says the decision will clear up any questions about the right to the name.
Microsoft had been in court this week defending its right to use the Internet Explorer name after being sued by the former owner of an Internet service provider who claims he used the moniker first.
The lawsuit was filed by Dhiren Rana, founder of SyNet , an Internet service provider in Chicago that went out of business last year. SyNet began distributing its own Internet Explorer browser in late 1994. When Microsoft began using the Internet Explorer name in April 1995 Rana complained to the software giant and filed a civil lawsuit in October 1995.
Rana, of Downers Grove, Illinois, has previously reportedly refused a $US75,000 out-of-court settlement. The trial began yesterday in the court of US District Judge Charles Norgle in Chicago before a seven-person jury. It is expected to last through next week, according to Microsoft spokesman Mark Murray.
Microsoft claims it didn't try to register Internet Explorer as a trademark because the US Patent and Trademark Office had previously rejected a trademark application by a different software firm. The agency ruled that the name was a generic descriptive term in 1994 when Internet Software tried to register it, according to Murray.
The Patent and Trademark Office has apparently changed its tune and decided in May this year to begin registering Internet Explorer as a trademark for SyNet, against Microsoft's objections. Microsoft plans to challenge that trademark registration. Murray said he did not know why the agency would reverse its earlier finding.
A press spokeswoman for the Patent and Trade Office was not available today. Rana also did not return calls seeking comment.
Microsoft attorney William Conlon told the court this week, according to the Associated Press, that the "Internet Explorer" name was used before SyNet came out with its browser, and cited an April 1994 book titled "Internet Explorer Kit" and software called Hayes Smartcom Internet Explorer.
"Microsoft argues that the term 'Internet Explorer' is a descriptive term available to any company to use in naming and describing their product," Murray said today. Microsoft, meanwhile, considers "Microsoft Internet Explorer" the brand name for its browser, he said.
But a witness for Rana, Carol Scott, a marketing professor at University of California at Los Angeles, testified this week that Microsoft clearly packages and promotes Internet Explorer as a brand, the AP reported.
Ironically, Rana now works for Netscape Communications as a consultant in Netscape's professional services area in Chicago. A spokeswoman for Netscape, whose browsers compete with Microsoft's, said Netscape is not involved in Rana's battle with Microsoft, which began years before he began working for Netscape.
Netscape has been a vocal critic of Microsoft's business practices related to bundling its browser with its operating system, which is the subject of an antitrust lawsuit filed against Microsoft by the U.S. Department of Justice and 20 states. Trial in that case starts Sept. 8.