Two technology heavyweights are going back to their corners this week, and might be preparing to call an early draw in what could otherwise be a lengthy trademark fight.
On Wednesday, Cisco agreed to give Apple more time to respond to the trademark suit it filed against the Mac-maker on January 10, the day after Apple declared to the world that it had "reinvented the phone."
Cisco took exception to Apple's announcement, claiming its use of the iPhone name infringed on trademark rights Cisco had obtained with its purchase of InfoGear in 1996. The networking giant's suit claims Apple's use of the iPhone trademark will cause confusion among customers.
Raising a White Flag?
Both companies have taken aggressive, public stances on the issue over the past few weeks. However, the corporate behemoths now have agreed to continue discussions with the "aim of reaching an agreement on trademark rights and interoperability."
The joint statement signals that the companies might be willing to raise a white flag and meet in the middle of the battlefield with an agreement rather than in a courtroom with an argument.
David Radack, chair of the intellectual property department of Pittsburgh-based law firm Eckert Seamans, said that with approximately 95 percent of all civil lawsuits reaching a settlement before trial, there is a strong chance that Apple and Cisco will come to terms over the iPhone trademark.
The joint press statement the companies released, he added, illustrates a willingness by both parties to negotiate a truce.
Avoiding Years in Court
"If people really want to avoid a lawsuit, they will allow extra time to continue negotiations rather than going ahead with a full-blown lawsuit," Radack said. In his experience, the closer parties get to the court date, the less likely they are to settle because they are more invested in the case through time and legal  fees.
However, both parties also have incentive to reach an agreement. Trademark lawsuits can drag out in the court system for years and rack up hefty lawyer fees on both sides. And Apple might have an additional incentive to settle. If Cisco obtains an injunction against Apple's use of the iPhone trademark, it could throw a kink in the Mac-maker's marketing efforts as it comes closer to the iPhone's planned June launch.
As for potential outcomes, Radack said he can't speculate about the discussions between the companies. "There's a whole gamut of possible settlements they could be discussing at this point," he said. "They kept [the statement] general because they probably wanted to keep all their options open."
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