In response to the lawsuit filed against them from Office Live, Jack Evans, a spokesperson for Microsoft, has issued a statement. Loosely, they claim that they do not view Office Live's trademark as such and do not feel they are infringing on any rights. They brought up examples of other uses of the term “Live” as a way to describe a product, but not necessarily as a trademark.

We told Office Live LLC as much when they first contacted us a year ago. We detailed other common uses of “live” as a descriptor, citing examples such as “AOL Live,” “Vodaphone Live,” “XBOX Live,” and “WTP Live.” We also pointed out that we’ve used Office Live Meeting since 2003 to promote our online meeting technology and services.
You can read the full statement in the comments section.