The winner is a chastened Bill Gates.
Gates saw his stake in Microsoft, the muscular software company he co-founded, rise by more than $2 billion when a judge closed the case on an anti-trust settlement with the US government last week and shares in the company shot higher as an immediate response.
While that may pale in comparison to other billion-dollar swings in his favour during Microsoft`s 27-year history, it could prove to be the sweetest gain yet, even as the company still faces a battery of remaining lawsuits.
US District Judge Colleen Kollar-Kotelly`s endorsement of the anti-trust settlement with the Department of Justice means Microsoft, which dominates the PC software market, will be largely free to set its sights on new markets for homes and businesses, analysts said.
But with Microsoft still facing legal challenges to its market position, Gates has also shown a new-found respect for public diplomacy, observers said.
"We are committed to being a responsible industry leader," Gates told reporters after the ruling, joined by his wife Melinda, credited by many with helping to keep his legendary temper in check at his second trial appearance in April.
Gates had been criticised for quibbling over the meaning of common words and appearing uncooperative in previous taped interviews during the case, but since then has been careful to project a kindler, gentler face for the company, analysts said.
"They have been held in check, but the reality is that Microsoft is an aggressive competitor," said Charles Hill, professor at the University of Washington`s business school.
"There was nothing in that settlement that puts them at a competitive disadvantage," Hill said.
With growth in the PC market wavering, Microsoft is pouring billions of research dollars into business software, video games, online services and new technology and aiming to keep its grip on its Windows and application software market.
While some analysts said the decision taught rivals to stay out of Microsoft`s way, others said the world`s largest software maker would face litigation for years to come.
Microsoft will find out by the end of this year whether it will face anti-trust sanctions in Europe, and competitors vowed to keep Microsoft in court with their own lawsuits.
"We have only scratched the surface of what software can do in our homes, our schools and our economy," said Gates. "While putting new responsibilities on us, this settlement also gives us the freedom to keep innovating for our customers."
A tempting target
One of the main reasons why Microsoft will remain everyone`s favourite company to sue is its huge cash hoard, $40.5 billion at last count, bigger than Gates`s $32 billion stake in the company.
And that cash balance is likely to keep growing, with Microsoft on track for a record year of profits, even while competitors such as Sun Microsystems and AOL Time Warner have seen their profits shrink amid the general downturn in technology spending.
"Microsoft might at some point in the future have to settle this private anti-trust lawsuit with AOL," said Matt Rosoff, analyst at Directions on Microsoft, an independent researcher.
"If that happens, it could open a new wave of litigation as other companies who believe they have been hurt by Microsoft`s monopoly line up for a cash payout," Rosoff said.
Microsoft, by its own admission, has built up its cash position to deal with the consequences of litigation.
Microsoft`s chief executive, Steve Ballmer, did not indicate on Friday whether the company`s stance on its cash holdings would change as a result of the ruling.
"We continue to have a lot of risks and opportunities in our business and we continually assess those with our board of directors," Ballmer said in response to a question.
Many shareholders may start to more forcefully question whether Microsoft might start drawing down its cash in the form of dividends, analysts said.
"That is a huge question, one issue that is actively discussed within the company," said Hill. "It is no longer a growth story."
Microsoft, for now, appears to disagree and insists that investing retained earnings back into the company is better for shareholders than paying out profits.
"We won`t see Microsoft pay a dividend to shareholders anytime soon because the company believes it can still grow the stock price through investments, and because the tax implications for large shareholders (including top Microsoft executives) would not be good," said Rosoff.
In the hours after the judge handed down her decision, Microsoft shares jumped to $56.33, from their Nasdaq closing price of $53.
Shares in Microsoft have gained 28% since 10 October but are still down some 20% since the start of the year.
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