Mullor calls Microsoft's action a retaliation suit. "These are shameful, dishonest attacks on my character by Microsoft -- the company that stole my idea in the first place," he said in the statement. "Microsoft fired me for trying to protect my own invention -- an invention I told them about before they ever hired me."

He claims that one person he pitched his product to at Microsoft before he started working there was involved with the development of Microsoft's activation technology.

Mullor is listed as chairman and founder of Ancora on its Web site, which appeared to be offline for some of the day on Friday. His biography included his time working for Microsoft and said that he once served in the Israeli Military Intelligence and has a law degree from an Israeli university.