In an attempt to settle its patent scuffle with VirnetX Holding, over VPN (virtual private network) technology in Windows, Microsoft said on Monday that it has worked out a $200 million settlement with the company; and also intends obtaining a license for using VirnetX technology in Microsoft products.

VirnetX had filed the patent infringement lawsuit against Microsoft in 2007, alleging that Microsoft had infringed upon two of its VPN patents via the unauthorized use of the technology in Windows XP and Vista.

A US District Court ruling this March went VirnetX’s way; and Microsoft was asked to make a $105.75 million payment to VirnetX as damages, as it had willfully infringed on the VPN patents in question.

However within a few days of the court ruling, VirnetX filed yet another lawsuit against Microsoft, asserting that Microsoft was also using the same patent-violating technologies in Windows 7 and Windows Server 2008 R2 – thereby violating US patents 6,502,135 and 7,188,180, which pertain to specific ways for securing IP-based communications through VPNs and similar technologies.

Now, noting that the settlement was in place and that the lawsuit will be dismissed, Tom Burt, Microsoft’s deputy general counsel, said: “We are pleased to work with VirnetX to bring these cases to a successful resolution through this settlement. We look forward to VirnetX's continued progress as it develops its technologies.”