The dispute between the two companies started when Microsoft decided to drop Sun's Java Virtual Machine (JVM) from its flagship Windows XP product. JMV is a piece of code that is needed for a computer to run software written in Java.
The Java programming language, developed by Sun in 1995, is widely used in internet-based applications, because it allows programmers to develop applications compatible with many types of computers, regardless of the operating system they run.
Sun viewed the dropping of its JVM from XP as an attempt by Microsoft to sabotage Java, and sued Microsoft for over $1 billion in the US District Court in Maryland, arguing that the act was in breach of antitrust laws.
Sun said that Microsoft has forced developers to distribute products incompatible with Java, causing developers to turn to Microsoft's .Net platform. To prevent this form happening until the case was heard, Sun asked the court to issue a temporary order requiring Microsoft to ship JVM with each copy of Windows XP and Internet Explorer.
Federal Judge J. Frederick Motz granted the order on 23rd December 2002, reasoning that Microsoft had used its dominant market position to gain unfair advantage. The judge also ordered the two companies to negotiate the specifics of the order.
The two sides, however, failed to agree on the terms of the order, with Microsoft claiming it would take up to a year to comply. The software giant argued that a sudden change in Windows would create problems for corporate users of the operating system.
Following a hearing last week, where both sides presented their arguments, the judge ordered Microsoft to start shipping Java with Windows within 120 days. He also instructed the two sides to reach a compromise on the details of the injunction.
Following negotiations, Sun and Microsoft eventually agreed on a plan, which was delivered to the federal judge for approval on Monday, Reuters reports. The specifics of the agreement were not disclosed. Microsoft, however, reportedly said it would soon file an appeal against the injunction.