Apple Computer will resolve its patent squabble with Creative Technology by paying the Singapore-based company US$100 million for a license to use a recently awarded patent.

The deal announced today ends all legal disputes between the companies, including five currently pending lawsuits, according to a statement. In return for its payment, Apple will get a paid-up license for use of the patent in all its products. It can also make some of that money back by licensing the patent to other companies. In addition, Creative will make iPod accessories under Apple’s “Made for iPod” program starting later this year.

Background

Creative is a leading competitor to Apple, which dominates the portable media player market with the iPod. In May, Creative asked a U.S. court to block sales of iPods, saying they violated a patent that covers the user interface software in most portable media players, including the iPod. Creative also asked the U.S. International Trade Commission to block the importation of iPods into the U.S.

The settlement “removes the uncertainty and distraction of prolonged litigation,” Apple Chief Executive Officer
Steve Jobs said in a statement. The payment will add about $0.85 per share to Creative’s earnings in its current quarter, ending Sept. 30, the companies said.

This entry was posted on Saturday, August 26th, 2006 at 4:18 pm and is filed under iPod. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.