Yes, it went well for Linspire, still it attracted a lawsuit, and the reason they didn'tlose wasn't because Lindows is different from Windows but because "windows" was a generic term already used as such by Microsoft itself.
I wonder what would have happened if the MS product was called say WinOS and the other one LinOS, where none of the terms are common words so that similarity would be the only matter.
Since they are saying it is 'for Linux' rather than it is Linux, I suppose they are probably ok, although the system doesn't contain or even work with any parts of Linux itself in any way.