Apple Settles Creative Lawsuit for $100 Million

E IS mC(Square) writes "CNet News reports that `Apple Computer and Creative Technology have agreed to settle their legal dispute over music player patents for $100 million, the companies announced Wednesday. The $100 million, to be paid by Apple, grants Apple a license to a Creative patent for the hierarchical user interface used in that company's Zen music players. The patent covers an interface that lets users navigate through a tree of expanding options, such as selecting an artist, then a particular album by that artist, then a specific song from that album. Creative filed for the patent on Jan. 5, 2001. Apple can get back some of the $100 million payment if Creative is able to secure licensing deals with other MP3 player manufacturers, said Steve Dowling, an Apple spokesman. "Creative is very fortunate to have been granted this early patent," Apple's CEO Steve Jobs said in a press release.`"

Comments

OK then, $100mill question

[Kanasta]

so does that mean Creative invented the treeview, or the database search?
cuz billions of programs out there may be affected by this.

This is BS

[hackstraw]

100 million is a pretty big payout for an obvious way to navigate through music that I myself invented when I was a kid. This method is: "The patent covers an interface that lets users navigate through a tree of expanding options, such as selecting an artist, then a particular album by that artist, then a specific song from that album."

I mean, isn't that how the stuff is organized in the record store too?

  "No wireless. Less space than a nomad. Lame." 100 million dollars in patent taxes lame.

If you ever wondered what is wrong with patents

[edbarbar]

This is a great example. The patent claims read just as described: how do you find a track to play using indexing.

Patents like this are not helping the public interest, but are simply ways for companies to lock out ideas without having to pay to develop them.

Time for the open source community to make "open patents" that are used to attack companies like creative that abuses them.

All your patents are belong to us

[robotsrule]

I have three fears with every line of code I write:

- It is buggy
- A better block of code already exists in SourceForge or somewhere else on the Internet
- It is stepping on one or more patents for completely obvious or barely novel ideas

I believe at this point paranoia is not only rational but optimistic and gin and tonic are my only defense since I can't afford lawyers, guns, and money.

Re:All your patents are belong to us

[VValdo]

I wonder if your fear #3 is grounds for challenging current patent law. I mean, the constitution says the congress shall have power:

To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;

I believe at this point paranoia is not only rational but optimistic and gin and tonic are my only defense

If it can be demonstrated that the current law is HAMPERING the progress of science, would that not make overreaching patent law unconstitutional? That may be a hard case to make, but I bet there is a ton of evidence to support the premise, from scientists who are afraid to invent or publish, programmers who are afraid to release code, corporations which sit on inventions rather than exploit them, etc. Would not a climate of fear engendered amongst Authors and Inventors not be hampering the progress of science and the useful arts?

Incidentally, I note that the constitution specifically refers to "writings and discoveries." What is the "discovery" related to this particular patent?

W

Re:Well.... there's gotta be a reason

[tji]

Good point.. By licensing the patent, they are legitimizing it. The net effect is that it creates a big barrier to entry for new competitors. This is easy to do when you're the dominant player already seeing tons of revenue. Paying millions in licensing is a non-starter for the small innovators looking to enter that market.

really good chess move by Apple...

[primalamn]

I think this post at MacRumors hit the nail on the head:

http://forums.macrumors.com/showpost.php?p=2752753 &postcount=115/

So, in summary...

Apple pays Creative a one time fee of $100M to licence their patents.

Creative joins the 'Made for iPod' program making accessories for their competitor, Apple, who gets money for 'Made for iPod'.

Creative still HAS to defend it's patent against other competitors - that's the nature of patents - or licence it to them. If they do, Apple takes some of that money too. In a round-a-bout way, Apple is getting money back from it's competitors. Nice.

Creative have a much better case because Apple settled.

Creative still owns a valid patent. If Apple had won, there would be no patent so anyone could copy the Creative/Apple style interface.

Apple continues on as if nothing has happened. No long court case delaying sales. No injunctions to halt imports.

Explain to me why people think Apple lost here?

Creative knew it was about to get reamed by Microsoft's Zune which it's players aren't compatible with. They knew to get out of the market. Instead of legitimising Microsoft's offering, they've tied up with Apple. It might bug us that Apple have legitimised a bogus patent but it's otherwise very, very smart.

I think the thing that people are forgetting here is that by settling Apple is pretty much making Creative defend this patent, essentially outsourcing the litigation - they pay nothing for that. If Creative does not defend the patent, or loses any case setting new precedent, Apple could conceivably sue to get the $100 million back.

Plus, they get back money, as stated above, for the 'Made for iPod' program that Creative is now a part of, and the iPod ecology is enhanced. They have taken on a partner here.

This is a win for Apple thinking long term. Good chess playing.

Re:Non-obvious to someone skilled in the art?

[antispam_ben]

What I learned from my company (by seeing it done before my very eyes) was that you get a patent on what will do the most to hinder the competition, regardless of whether it is an innovative part of the design. It's up to the attorney writing the patent to hype up how it is innovative. Patents in the last several decades get pushed through with little or no regard to the "Non-obvious" and similar clauses. I and a co-worker have two patents, each in both our names and we had nothing to do with choosing what areas were patented. FWIW, the complete schematic and an attorney-digested (i.e. expanded in to legalese/patentese) descripion of the complete device's operation were put into the patent. I could show you what I and the other engineer thought were the innovative parts, but those weren't what got patented.

If you can get a patent on a method for growing broccoli sprouts, go for it - it will only take the rest of the broccoli sprout industry going to court to get it declared invalid. Yes, it happened, google for the story.