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

Doesnt it sound like...

[NexFlamma]

""Creative is very fortunate to have been granted this early patent," Apple's CEO Steve Jobs said in a press release.`"

You can almost hear him whispering "motherfuckers!" under his breath after saying this.

Re:Doesnt it sound like...

[Anonymous Coward]

I've had it with these motherfucking patents on this motherfucking planet!

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.

Re:This is BS

[ilmdba]

don't be a prick. the text of the patent could be directly interpreted as "selecting an artist, then a particular album by that artist, then a specific song from that album" as the parent posted. just because you dug up the verbose text doesn't change what it is.

and yes, it's a pretty fucking obvious way to categorize and navigate through digitally stored music.

just about every ripper i've used has an option to create artist then album directories to contain the actual song files - so just putting a folder of ripped tunes behind a web server infringes on creative's patent? that's BS, completely fucking obvious, and never should have been granted as a patent.

the question now is, who has the patent on doing this with video?

What amazes me

[pickyouupatnine]

.. is that the idea was patentable. I mean come on... a simple heirarchical tree interface got patented? Who cares if it was for an mp3 player - does that make any difference? We've had tree interfaces for a while - its how many of us organize our music libraries (virtual and physical).

Re:What amazes me

[Anonymous Coward]

Yeah, which is more scary:

1) that something *SO* obvious was granted a patent, or
2) that it was probably cheaper for Apple to pay $100 million rather than to try to prove it was that obvious in court.

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

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

[mpaque]

Heh. Most of the press copied this line from the Apple/Creative press release:

Apple will pay Creative $100 million for a paid-up license to use Creative's recently awarded patent in all Apple products.

They were in a hurry, though, and not many caught this:

Apple can recoup a portion of its payment if Creative is successful in licensing this patent to others.

So, Creative now has cash in the bank, 'validation' of its patent with a license from Apple, and an incentive to go forth and seek licenses from others...

Then there's this:

In addition, the companies announced that Creative has joined Apple's "Made for iPod" program and will be announcing their own iPod® accessory products later this year.

Apple puts money into Creative, Creative makes iPod accessories, and a cut of the accessory revenue goes back to Apple.

So... Apple gets rid of some lawsuits, sets things up to make trouble for some other music player makers, and gets another revenue stream. All in all, this doesn't look too bad as a business move for Apple.

Re:disgusting!

[back_pages]

You don't have the slightest clue what you're talking about. (This is the 1 sentence that has replaced the 100 line flame that I just deleted.)

Patent for hierarchical user interface? Anything from a file system to nested menus is a hierarchical user interface. Oh but this one is used in a music player. That's where the innovation comes in.

I'm not sure what you're talking about but it is not the claims from the patent. If you'd like to respond, I'm going to require that you read the claims of the patent because otherwise you are literally wasting my time. Here is the link. The Patent

The patent system is in need of a major reform. Currently when you are sued for patent infringement you have the burden to prove that either you don't infringe on the patent or that the patent is invalid. This obviously doesn't work.

First, you are apparently unaware of a JMOL for clearly unreasonable patent infringement suits. Secondly, it's called "a defense". Technically it's optional.

Instead, the patent holder should have the burden of proving that the invention is truly novel and non-obvious. The patent would simply serve as documentation proving when a particular thing was invented.

It's called "patent prosecution" and it's the only way to get a patent in the United States. Clever idea.

The patent office would not need to examine patents for validity (i.e. it could continue doing what it's doing) since that would be established at the trial. This would cut down on the amount of "one-click" patents, reduce or even eliminate the need for defensive patents, and make patent trolling much more difficult.

(I've already deleted 100 lines of flame but let me say) I don't believe for a second that you have the slightest idea what is or is not a valid patent. Secondly, I don't think you have put any thought whatsoever into how you would prove or disprove this at a trial from scratch. (I say my patent is valid. We're done. Oh no - suddenly someone has to prove it's INVALID - we're right back to the problem you claim to have solved.) I think that you are unaware that patent prosecution before the patent office takes anywhere from 2-6 years. You suggest we move that (or some variant) into the COURTROOM? Are you trolling? Thirdly, you have begun your paragraph with a groundless conclusion and end it the same way - how in God's name would this make trolling any more difficult? Under your system, I don't even need to WIN the infringement suit, I can simply tie up your exorbitantly expensive legal team for an additional 5 years. It's legal extortion at its best.

I know this post is not very nice but please bear in mind that what you've read is completely rewritten. I don't intend to flame, but I do think you're completely out of your element. The bottom line, for me, is that I really wish Slashdot would stop carrying stories about patents because misinformation and worse is consistently moderated to the top. Without a doubt, Slashdot is the Fox News of patents.

Re:What goes around comes around

[gameforge]

Consider how many people 100 million dollars could employ.

A thousand perhaps?

The money didn't vanish, it moved. That same $100m should be able to employ equally as many people at Creative, or less better people or more worse people or whatever. For all you know that money was lining some bank account somewhere, which will now be $100m shorter with little affect on employees, whereas Creative will use it to create a thousand jobs (like perhaps a better Linux team)

I see it as the old, fair and friendly neighborhood heroin dealer shot the new fast talkin' "tough guy" heroin dealer (honestly, like Apple, the perfect and selfless angel was punched in the face by Creative, the big bad devil).

I like Apple, honest. I think Creative did an unethical thing with this lawsuit; and I agree with your reamark about it discouraging competition and innovation.

Now ask me if I think Apple did an ethical thing by flying into Creative's camp, pissing on their tent, and taking Creative's fair? share of Rio's MP3 player market. Hmm?

I have to assume Apple wouldn't visciously steal Creative's market share if "business" hadn't demanded that they take that opportunity. I also have to assume that Creative dislikes patents as much as you and I.

I'll bet most athletes, at times, dislike the fact that if they have less points than their opponent, they lose. They may have worked harder. They may have deserved it more. They may have wantedit SO much more. Their eighteen kids may be dying and only wishing to see their mother/father win, whereas their opponent's looking for their eighteenth win.

(point being, everybody has to play by the unfair rules, and $100m never just "vanishes" in a lawsuit between two giants, unless of course it's to a lawyer)