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Mono has been around long enough for MS to take any action it wanted to to prevent its continued growth. I am not very familiar with legal issues like this but since it has been public for as long as it has what recourse would MS have at this point anyway?

Besides, allowing the development of something like mono is a step in the right direction by MS. We should be showing them that we want more in this direction and less in the use Windows or we don't care direction.