Lindows has withdrawn its products from sale in the Netherlands, Belgium and Luxembourg in the latest stage of its legal battle with Microsoft.
The open source operating system company said it had received legal papers filed by Microsoft in the Netherlands asking the court to fine Lindows €100,000 (£68,000) per day for allowing its website to be accessible to visitors from those countries.
Last month Lindows altered its name in the Benelux region in order to carry on doing business there, launching the Lin---s (lindash) website.
But this morning a notice on the website said: "Important Notice! Sorry, pending our appeal visitors from the Netherlands, Belgium, and Luxembourg are not permitted to access our website or purchase our products."
Michael Robertson, chief executive officer of Lindows, said in a statement: "We have completely withdrawn our products from these markets and put notices on every page of our website, yet Microsoft is still asking that the judge fine us €100,000 per day because non-US visitors can view our US-based website.
"Since visitors to our website come from international ISPs, proxy servers, anonymisers and other methods, it is impossible for us to comply with such a broad order to block all visitors from Benelux, and Microsoft knows this."
Lindows said it has "implemented a complete withdrawal from the Benelux market pending an appeal of the original order".
A hearing date for this new action has been set for 30 March.
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