MICROSOFT MAY BE against the ropes in its antitrust battle with the U.S. government, but it can take some solace in a preliminary ruling that could save it $35 million in its legal war over Java with Sun Microsystems.

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A U.S. District Court Judge last week tentatively dismissed Sun's claim that Microsoft posted portions of Sun's Java source code on its Web site in violation of its Java licensing contract. Under terms of the contract, any company that commits such a violation would be required to pay Sun $35 million in liquidated damages.

Judge Ronald Whyte tentatively granted a motion filed by Microsoft to dismiss Sun's claim, saying that it's not clear yet whether Microsoft posted the code intentionally and with the knowledge of senior managers, or whether the code was generally available to the public. He invited the companies to argue the matter further in court at a hearing set for Aug. 11.

"It's a tentative order, which means it's not binding," said Sun spokeswoman Penny Bruce. "Tentative orders are designed to help focus oral arguments on specific questions articulated by the court, so it will help focus our oral arguments on Aug. 11."

Microsoft's motion to dismiss Sun's claim is just one element of a broader lawsuit that has kept the companies at loggerheads for more than three years. Sun filed its lawsuit against Microsoft in November 1997, accusing the company of illegally using an "impure" version of Java in its products that works best with its own Windows software. Microsoft denies the charges, and has countersued Sun.

While pretrial hearings have been underway, no date for an actual trial has been set. The case is being heard in the U.S. District Court for the Northern District of California in San Jose.

In a separate order issued last week, Judge Whyte also designated Aug. 11 as the date for a hearing on all outstanding summary judgment motions in the case. He pegged the same date for a case management conference at which a date for the trial will be set, along with a date when each side will have to disclose its expert witnesses for the trial.

The news comes as Microsoft lawyers prepare their final arguments as to why the software giant should not be broken into pieces by the U.S. government as a way of resolving repeated antitrust violations. The filing is due to be made Wednesday in the District Court in Washington.

Microsoft's alleged violation of its Java licensing contract was cited by government attorneys during the antitrust trial as evidence of its anticompetitive behavior.

Microsoft Corp., in Redmond, Wash., can be reached at www.microsoft.com. Sun Microsystems Inc., in Palo Alto, Calif., can be reached at www.sun.com.