Apple and HTC have decided to stop their patent war by signing an agreement to settle all their outstanding disputes. The two firms also signed a 10-year license agreement that will extend to current and future patents held by one another. The financial side of the transaction is kept secret by both companies.
The patent conflict between the two IT giants appeared in March 2010. Apple had filed, and won, several lawsuits against the Taiwanese company. HTC, in response to several lawsuits, filed, but failed to make serious progress on the legal front. Observers note that the company could go to the world on terms that HTC will pay royalties of U.S. companies to avoid further litigation.
“HTC is pleased to have resolved its dispute with Apple, so HTC can focus on innovation instead of litigation,” Peter Chou, CEO of HTC, said in a statement.
“We are glad to have reached a settlement with HTC,” said Tim Cook, CEO of Apple. “We will continue to stay laser-focused on product innovation.”
Since Apple sued HTC first, its patent war has engulfed smartphone competitors, such as Samsung Electronics and Google’s Motorola Mobility. The iPhone maker won a verdict of $1 billion against Samsung in August, while the litigation against Motorola has produced no decisive victory.
But, Apple has had more success against HTC when resorting to litigation to effectively interrupt the flow of products in the crucial U.S. market.
Last year, the International Trade Commission ruled that HTC infringed on one of four patents Apple had disputed and imposed a sales ban on some of the phones. While HTC said it had found a technical solution to Apple’s patents, the company announced in May that shipments of its phones were being held by customs officials in the United States.
HTC has been considered to be one of the strongest players in the market, but the company could not withstand the competition with Apple and Samsung. Last month, HTC forecast a revenue decline of 14.5% in the last quarter against the backdrop of continued decline in sales.