I suppose I don't find this all that radical because it seems in line with corporate personhood. Suppose I'm a US citizen but I become embroiled in some dispute with the government; I might also hold an Irish passport but that isn't going to let me blow the matter off. It seems to me that if you enjoy the benefits of US corporate citizenship -access to wealthy and highly liquid markets, access to the US courts, and so on - then you shouldn't be able to disclaim your US citizenship by paying the very small needed to set up a foreign subsidiary and pretending it's wholly independent from you (even though it it has the same name, brand, etc. and you own all the shares of this notional subsidiary.
Let's face it, it's 'technically' a separate legal entity but nobody disputes that it's ultimately the same company, a local clone of the original if you will. MS certainly has the right to make their legal argument about the differences for as long as the courts will entertain it, but it seems like a bit of a bullshit argument to me.
I say 'seems' because I'm guessing a bit - unhelpfully, the news article doesn't cite the case in question, so I haven't looked up any of the filings to see what the matter is or study the particular arguments. I probably should, but I'm feeling a bit lazy about it :/