Cisco has sued Apple over its use of the term iPhone for its newly announced mobile device, despite reports that they were near an agreement with Apple to share the name.
After Steve Jobs wowed the Macworld faithful and the tech community at large with his announcement of the long-awaited mobile dubbed iPhone, a representative for networking giant Cisco had said they expected to reach a deal with Apple about the trademark.
That statement from Cisco appeared on ZDNet:
Given Apple’s numerous requests for permission to use Cisco’s iPhone trademark over the past several years and our extensive discussions with them recently, it is our belief that with their announcement today, Apple intends to agree to the final document and public statements that were distributed to them last night and that address a few remaining items we expect to receive a signed agreement today.
Somewhere, somehow, instead of finalizing the deal, someone at Apple, and Jobs has to be the most likely suspect, nixed the deal.
Cisco responded just as Apple has to websites using the term iPod in their names, by suing over trademark infringement.
“Cisco entered into negotiations with Apple in good faith after Apple repeatedly asked permission to use Cisco’s iPhone name,” Mark Chandler, senior vice president and general counsel, Cisco, said in a statement. “There is no doubt that Apple’s new phone is very exciting, but they should not be using our trademark without our permission.”
That trademark came to Cisco via its acquisition of Infogear in 2000. Another Cisco purchase, Linksys, has been shipping iPhone branded products since early in 2006.
The term iPhone has been a registered trademark since 1996, when Infogear first registered it. In a blog post about the lawsuit, Chandler said Apple has been asking about using the name since 2001.
He also commented further on the behind the scenes talk between the two companies about iPhone:
We negotiated in good faith with every intention to reach a reasonable agreement with Apple by which we would share the iPhone brand.
So, I was surprised and disappointed when Apple decided to go ahead and announce their new product with our trademarked name without reaching an agreement. It was essentially the equivalent of “we’re too busy.” Despite being very close to an agreement, we had no substantive communication from Apple after 8pm Monday, including after their launch, when we made clear we expected closure. What were the issues at the table that kept us from an agreement? Was it money? No. Was it a royalty on every Apple phone? No. Was it an exchange for Cisco products or services? No.
If the tables were turned, do you think Apple would allow someone to blatantly infringe on their rights? How would Apple react if someone launched a product called iPod but claimed it was ok to use the name because it used a different video format? Would that be ok? We know the answer – Apple is a very aggressive enforcer of their trademark rights.
An Apple response to the lawsuit appeared on the Wall Street Journal’s Law Blog:
Apple spokesman Steve Dowling called the Cisco lawsuit “silly,” adding there are several companies using the term iPhone for VOIP products, and Cisco’s trademark is “tenuous at best.” “We’re the first company to ever use the iPhone name for a cellphone,” he said. “If Cisco wants to challenge us on it, we’re very confident we’ll prevail.”
It would appear that somewhere over the past few years since 2001, Apple had decided a sharing agreement with Cisco just wasn’t going to happen. One would be hard-pressed to believe Apple spent a lot of time negotiating with Cisco, only to have a moment of satori at the last minute and realize they didn’t need Cisco’s permission after all.
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David Utter is a staff writer for Murdok covering technology and business.
