Apple announced Wednesday it has settled its legal dispute with Creative Technology to the tune of $100 million. What’s more, Creative will begin making iPod accessories later this year.
Apple CEO Steve Jobs called Creative “very fortunate to have been granted this early patent” in a statement announcing the settlement, and added, “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 Chairman and CEO Sim Wong Hoo offered similar conciliatory language, and said that thanks to Apple’s “huge ecosystem” for the iPod, his company will introduce iPod-compatible speaker systems, earphones and headphones and “X-Fi” products in the months to come.
Creative and Apple had filed a volley of lawsuits against each other over the iPod. Creative alleged that Apple violated what Creative calls
its “Zen Patent,” which describes the way musical data is display on a digital music player. Apple responded
with its own suit, alleging that Creative had infringed Apple’s patents.
Apple said in a statement that the terms of the agreement pay up a license between the companies in all Apple products. What’s more, Apple can recoup a portion of its payment if Creative is successful in licensing the patent to other companies.
Apple and Creative announced that Creative has joined Apple’s “Made for iPod” program and will release iPod accessory products later this year.
The $100 million payment will add $0.85 earnings per share to Creative’s current fiscal quarter, Sim revealed. That quarter ends September 30, 2006.