You'd think a company that was sued by Novell would be reluctant to put itself at risk for another major corporate lawsuit. Timpanogas Research Group may not be itching for a fight, but it could land in the middle of a legal battle involving none other than Microsoft. Is this Round 13 of the fight between Bill Gates and Ray Noorda, the former Novell chief executive who is one of Timpanogas' primary funders? It's shaping up that way. According to Timpanogas' chief executive Jeff Merkey, Microsoft has threatened Timpanogas with litigation over what Microsoft claims are violations of its intellectual property rights involving the NT file system (NTFS). Merkey's claims were initially made in postings to a weekly Linux kernel newsletter called Kernel Traffic. The messages were subsequently reposted on Tuesday to the Linux enthusiast site Slashdot.org. "There seems to be no substance to this story -- at least from Microsoft's point of view. As far as we are concerned, these claims are untrue, and we're not sure why [Merkey] is making these statements," said Microsoft group product manager Doug Miller. Timpanogas is a company formed by three former Novell employees. Its original mission was to develop clustering and high-availability software for NetWare. Novell sued Timpanogas three years ago for allegedly stealing its intellectual property. Two years ago, the parties settled, with the Timpanogas founders agreeing to pay Novell an undisclosed amount. "We've been in one lawsuit with Novell. We don't want another one with Microsoft," Merkey said. There are a handful of companies that license Windows and its components. Those firms need to walk a fine line to protect Microsoft's intellectual property as stipulated by the software titan. For companies that work on Windows projects only, it's fairly easy to comply with Microsoft's insistence that people with access to the Windows source code guard Microsoft's crown jewels with their lives. But for the majority of hardware and software companies with access to the Windows source -- companies that work on multiple operating system projects -- it requires solid "Chinese walls" between divisions working on different operating systems. Timpanogas is an example of the latter kind of licensee. At this week's NetWorld+Interop trade show in Atlanta, for example, Timpanogas unveiled its Ute-Linux distribution, a release of Linux based on the native NetWare file system. But Timpanogas also had been working with Microsoft's blessing on a version of the NetWare file system that would run on NT. In fact, the company released an open source version of Novell Directory Services (NDS) on NT, but withdrew the product. Merkey said Timpanogas may still release its open source NDS on NT product, but it hasn't decided when. Microsoft was not happy with Merkey's work on Linux, he claimed. In fact, Merkey said in one of his postings that Microsoft accused him of conspiring with Linux creator Linus Torvalds to aid the open source camp in providing a full, open-source implementation of NTFS on Linux. Merkey said he received a note threatening Timpanogas with legal action, signed by Microsoft Windows licensing chieftain Dan Neault. Neault did not respond to a ZDNet News request for comment. "Microsoft has threatened us with litigation due to our support of Linux NTFS development, and we have dissolved our NTFS licensing agreements with Microsoft in response to their demands that cease to support Linux development," said Merkey in a posting dated 14 September. "Microsoft demanded that we delete any and all NTFS tools we had been providing to customers based on their intellectual property. As a result of this, we can no longer provide this tool in the United States." Not only did Timpanogas dissolve its licence, it also returned to Microsoft all copies of NTFS source code and also deleted them from its servers and backup tapes, Merkey said. Merkey acknowledged that his company had been "providing some assistance to Linux guys on NTFS", but said that at no point did Timpanogas or its officials provide to open source developers any of Microsoft's intellectual property. "Our agreement with Microsoft was very broad. We wrote some conversion tools for converting NetWare and Linux file systems to NTFS," Merkey explained. "We were giving these tools to some Microsoft customers who were using NTFS on Linux, but who were having their hard drives trashed by it." Merkey claimed he was providing a service to Microsoft customers who needed to run NTFS across platforms, but that Microsoft had a different interpretation of his motives. "Microsoft's view is to hell with Linux and anything that helps Linux," Merkey said. But Merkey also admitted that Microsoft may be incensed further by public comments by some of his open source colleagues claiming that Microsoft has taken some open source code and is using it internally. Additional reporting by Steven J. Vaughan-Nichols, Sm@rt Partner. Take me to the Linux Lounge To have your say online click on the TalkBack button and go to the ZDNet News forum. Let the editors know what you think in the Mailroom. And read what others have said.