The latest copyright friction also came as Microsoft's market value shrank to $219 billion and was surpassed by longtime rival Apple, whose market value stood at $229 billion Thursday, Reuters reported.

Microsoft, whose operating system runs on more than 90 percent of the world's personal computers, has not been able to match growth rates from its heyday in the 1990s, Reuters said.

Li Wenwei, a leading expert in the field of IPR protection, earlier told the Guangzhou-based Nanfang Daily that "Microsoft's latest lawsuit against Tonecan was to minimize profit losses incurred by the global financial crisis."

"The company is to expand its market share and increase business profits," he said. According to Li, Microsoft China visited him two years ago and shared the idea to him of filing lawsuits against local Internet cafés.

Huang Rendong, an IPR protection lawyer in Dongguan who is familiar with the case, told the Global Times that both sides are willing to mediate on the suit ahead of the court hearing.

"Regardless of the final result of the case, domestic companies' awareness of IPR protection has been increasing," he said. "I hope multinational companies, such as Microsoft, can respect the national conditions of China. I am expecting a win-win result for both sides."

The lawsuit against Tonecan marks another step the US software giant has taken in its beefed-up drive against piracy in China, where pirated products are thought to remain in common use.

In late April, Microsoft received 2.17 million yuan in damages from Dazhong Insurance in Shanghai for illegal use of its operating systems. And in August 2009, Microsoft also won 3 million yuan in a lawsuit against Tomato Garden, a website that provided free pirated Windows XP software.

Guo Xiushen, with the China Trademark Association's Expert Committee, told the Global Times Thursday that it would be improper for Microsoft to make use of the copyright issue in China as a means to maximize its profits.

"Spreading knowledge about the copyright issue should be the first choice rather than claiming high compensation," Guo said.

The Chinese government has made attempts to crack down on software piracy. Computers manufactured within the country have been ordered to pre-install authorized operating software systems when they leave the factory.

A research report on China's software piracy rate, released by chinalabs.com, a Beijing-based independent Internet technology consultancy company, shows that the piracy rate of operating systems dropped to 27 percent in 2009 from 81 percent in 2005.