Washington: A federal judge refused on June 12 to throw out the antitrust case against Microsoft by states seeking tougher sanctions than the deal negotiated in 2001 by the federal government.

The decision by Judge Colleen Kollar-Kotelly did not rule on the merits of the case and left it on the schedule to be argued June 19.

But the judge rejected Microsoft's motion that the case be dismissed because the states had no standing to pursue their action.

Kollar-Kotelly said the question of jurisdiction had already been addressed in earlier court proceedings, a trial that ended in 2001 with Microsoft found guilty of abusing its monopoly, followed by an appellate court ruling that affirmed portions of the decision while rejecting others.

"The court cannot now revisit the issue of jurisdiction. The court must conclude that the issue was addressed and resolved by the Court of Appeals explicitly or by necessary implication," the judge said.

In her 35-page opinion, she also wrote that contrary to Microsoft's assertion, states do have the right to sue under US antitrust laws.

"It is beyond dispute that federal antitrust law, specifically Section 16 of the Clayton Act, provides statutory authorisation for claims brought by a state in its capacity as 'parens patriae," she said.

Late in 2001, Microsoft and the Justice Department agreed to settle their four-year- old antitrust dispute, which found the software company illegally maintained its operating system monopoly.

Only half of the 18 states jointly suing the company with the federal government signed that deal however, which awaits Kollar-Kotelly's signature to finalise it.

The states welcomed her decision to allow them to make their case in her court on June 19, when closing arguments have been scheduled.

"The decision confirms the rightful role of state attorneys general to prosecute antitrust violations," said Iowa Attorney General Tom Miller, who is co-ordinating the case for the "non-settling states".

"Now we can almost see the finish line in this case. We are looking forward to next week's oral arguments and then the Court deciding how to remedy Microsoft's violation of antitrust laws," he said.

States that rejected the government's settlement with Microsoft and have continued to pursue the antitrust case are California, Connecticut, Florida, Iowa, Kansas, Massachusetts, Minnesota, Utah and West Virginia, along with the District of Columbia.