Trailrunner7 (1100399) writes It's been a weird couple of weeks for Microsoft. On June 30 the company announced its latest malware takedown operation, which included a civil law suit against Vitalwerks, a small Nevada hosting provider, and the seizure of nearly two dozen domains the company owned. Now, 10 days later, Microsoft has not only returned all of the seized domains but also has reached a settlement with Vitalwerks that resolves the legal action. Some in the security research community criticized Microsoft harshly for what they saw as heavy handed tactics. Within a few days of the initial takedown and domain seizure Microsoft returned all of the domains to Vitalwerks, which does business as No-IP.com. On Wednesday, the software giant and the hosting provider released a joint statement saying that they had reached a settlement on the legal action. "Microsoft has reviewed the evidence provided by Vitalwerks and enters into the settlement confident that Vitalwerks was not knowingly involved with the subdomains used to support malware. Those spreading the malware abused Vitalwerks' services," the companies said in a joint statement. "Microsoft identified malware that had escaped Vitalwerks' detection. Upon notification and review of the evidence, Vitalwerks took immediate corrective action allowing Microsoft to identify victims of this malware. The parties have agreed to permanently disable Vitalwerks subdomains used to control the malware."