Nefrodite, what are you referring to? How is Sun evil? They work with a whole coalition of companies to develop and promote J2EE. It's well-known that Sun does not derive any direct profits from its Java software business. Sun isn't benevolent, but comparing them to M$ is a joke.
It's crazy how well the Microsoft PR machine works. They have everyone believing that Sun asked them to take Java out of WXP.
Listen, the first lawsuit was because Microsoft broke its Java licensing agreement, a legal contract. Period. As a result of that lawsuit, Microsoft lost its Java license, and will no longer develop Java technologies. I believe the settlement terms allowed them to continue shipping their current Java 1.1.4 virtual machine for a period of time.
Secondly, your perspective is myopic if you think this lawsuit is just about shipping Microsoft's weak Java 1.1.4 virtual machine in WXP. Although that product is functional for running older appets, it's otherwise a non-issue in the marketplace. You can still download the MS Virtual Machine for IE if you want that older functionality. Applets in general are pretty irrelevant in the marketplace anyway.
The new lawsuit claims anti-competitive actions by Microsoft aimed at damaging Java and J2EE. IANAL, but my guess is they will argue that Microsoft's attempts to pollute Java were anti-competitive actions aimed at damaging Java/J2EE. I won't argue the merit of this claim, but the argument is that if Microsoft didn't care for Java, they should have ignored it from the beginning.
However, by signing a Java licensing agreement, and then breaking that agreement, there is a (tenuous) logical connection that can be made that their actions were illegal and anti-competitive. Sun's legal team now has to introduce the government case as a legal precedent, and tie it all together. It's anyone's guess how the trial ends up.
In conclusion, the obsolete Microsoft Java 1.1.4 virtual machine is really just a footnote in the case.