Online reports today suggest that Microsoft may be considering a major lawsuit over the theft of Xbox 360 development kits - while a curious statement from a hacking group implicated in the theft claims that the software giant knew about it all along.

The lawsuit reports appear to stem from a Dutch newspaper story this week, which said that Microsoft is preparing a $100 million suit against those responsible for the theft - which could, according to development experts, speed up the process of hacking the security on the Xbox 360 significantly.

The veracity of that report, however, is drawn into some doubt by the fact that it goes on to claim that Microsoft is afraid that Sony or Nintendo may have got their hands on one of the development kits - which seems almost laughably unlikely, and probably wouldn't give Microsoft many sleepless nights even if true.

What's more unusual about the whole story, however, is a statement from a member of hacking group Smartxx.com, on whose websites pictures of the stolen devkits have emerged, claiming that Microsoft was actually complicit in the group's acquisition of the kits. Continue At Source

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