The CNN Money.com article is essential reading, but here's an outline.

Microsoft spent years figuring out that Linux infringed, it asserts, 235 Microsoft patents. Patent Hawk worked on the project years ago, by the way. The problem was how to make money off the infringement. Just settling its U.S. antitrust suit, Microsoft wasn't willing to soil its reputation with lawsuits.

Linux software is covered under the GNU General Public License (GPL), a savvy scheme cooked up by Richard Stallman, intended to keep the software in the public domain. The GPL license prohibits Linux distributors from cutting a straight patent deal with Microsoft.

Novell worked around GPL by striking a very peculiar deal with Microsoft, agreeing not to sue each other's customers for patent infringement, and a marketing collaboration that put $348 million of Microsoft money in Novell's pocket in return for a cut of Novell's Linux revenue through 2011, and with Microsoft handing out coupons for Novell Linux. The move satisfied corporate Linux patrons like IBM and HP, but hacked off the free software developers who sweat over a hot keyboard cranking out the open-source code.

Stallman, meanwhile, came up with a revised GPL, presumably effective this coming July, that will waive the right of Microsoft, as a Linux distributor (via its coupons), to sue any Linux user for patent infringement. Microsoft says that handing out coupons doesn't bond it to the GPL. Regardless, the new GPL will prevent other Linux distributors from striking a deal with Microsoft like Novell did; which leaves Microsoft, seemingly barred from another fandango a la Novell Linux, holding its patents like roses, trying to sweet talk direct licenses from Fortune 500 Linux users, an approach that, to date, has met with very limited success.