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Cisco, Apple Settle iPhone Lawsuit

Posted on: Wednesday, 21 February 2007, 21:00 CST

By JORDAN ROBERTSON

SAN JOSE, Calif. - Cisco Systems Inc. and Apple Inc. said Wednesday they have settled the trademark-infringement lawsuit that threatened to derail Apple's use of the "iPhone" name for its much-hyped new iPod-cellular phone gadget.

The companies said they reached an agreement that will allow Apple to use the name for its sleek new multimedia device in exchange for exploring wide-ranging "interoperability" between the companies' products in the areas of security, consumer and business communications. No other details of the agreement were released.

The companies both said they would dismiss any pending legal actions regarding the trademark.

The showdown between the Silicon Valley tech heavyweights erupted last month when Cisco sued Apple in San Francisco federal court claiming that Apple's use of the iPhone name constituted a "willful and malicious" violation of a trademark that Cisco has owned since 2000.

Cisco's Linksys division has been using the trademark since last spring on a line of phones that make free long-distance calls over the Internet using a technology called Voice over Internet Protocol, or VoIP.

The lawsuit was filed a day after Apple Chief Executive Steve Jobs unveiled his own company's iPhone, a multimedia device that operates over the cellular network instead of the Internet.

Apple initially called the lawsuit "silly" and argued that it was entitled to use the name because the phones operate over different networks and would not compete with each other.

Cisco maintained that in an era of "convergence" - where increasingly intelligent networks and devices can handle a variety of different types of voice, video, data and other transmissions - the two companies' phones could eventually take on different features and wind up competing head-to-head.

The result would be "confusion, mistake and deception among consumers," according to the lawsuit.

Negotiations between the companies broke down just hours before Jobs' dramatic unveiling of the product Jan. 9 in San Francisco.

The sticking point apparently was Cisco's demand that in order to use the iPhone name, Apple would have to open up its famously closed products to communicate with some of Cisco's offerings.

Source: Associated Press/AP Online

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