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Apple and Creative Technology, Ltd. today announced a broad settlement ending all legal disputes between the two companies. Apple will pay Creative $100 million USD for a paid-up license to use Creative's recently awarded patent in all Apple products.
Apple can recoup a portion of its payment if Creative is successful in licensing this patent to others.
Interestingly, the companies announced that at the same time, Creative has joined Apple's "Made for iPod" program and will be announcing their own iPod accessory products later this year.
Creative sued Apple claiming that it had infringed on a patent for the way in which music is displayed on a music player and the statement from Steve Jobs, Apple's CEO, reflects perhaps some frustration on the part of Apple...
"Creative is very fortunate to have been granted this early patent," said Steve Jobs, Apple's CEO. "This settlement resolves all of our differences with Creative, including the five lawsuits currently pending between the companies, and removes the uncertainty and distraction of prolonged litigation."
Creative began the litigation process, but Apple responded with a number of iPod-related lawsuits. However a recent vote by the International Trade Commission to investigate Apple's for possible infringement has seen Apple and Creative come an agreement.
"We're very pleased to have reached an amicable settlement with Apple and to have opened up significant new opportunities for Creative," said Sim Wong Hoo, chairman and CEO of Creative. "Apple has built a huge ecosystem for its iPod and with our upcoming participation in the Made for iPod program we are very excited about this new market opportunity for our speaker systems, our just-introduced line of earphones and headphones, and our future family of X-Fi audio enhancement products. We expect that the one-time licensing payment of $100 million will contribute approximately $.85 of earnings per share to our current quarter, ending September 30, 2006."
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