Cisco General Counsel explains ‘iPhone’ lawsuit; Cicso wanted interoperability with Apple iPhone

Commentary from Mark Chandler, Cisco’s SVP and General Counsel, on Apple’s infringement of Cisco’s iPhone trademark:

Today’s announcement from Cisco regarding our suit with Apple over our iPhone trademark has spurred a lot of interesting questions. Most importantly, this is not a suit against Apple’s innovation, their modern design, or their cool phone. It is not a suit about money or royalties. This is a suit about trademark infringement.

Cisco owns the iPhone trademark. We have since 2000, when we bought a company called Infogear Technology, which had developed a product that combined web access and telephone. Infogear’s registrations for the mark date to 1996, before iMacs and iPods were even glimmers in Apple’s eye. We shipped and/or supported that iPhone product for years. We have been shipping new, updated iPhone products since last spring, and had a formal launch late last year. Apple knows this; they approached us about the iPhone trademark as far back as 2001, and have approached us several times over the past year.

For the last few weeks, we have been in serious discussions with Apple over how the two companies could work together and share the iPhone trademark. We genuinely believed that we were going to be able to reach an agreement and Apple’s communications with us suggested they supported that goal. 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.

Fundamentally we wanted an open approach. We hoped our products could interoperate in the future. In our view, the network provides the basis to make this happen—it provides the foundation of innovation that allows converged devices to deliver the services that consumers want. Our goal was to take that to the next level by facilitating collaboration with Apple. And we wanted to make sure to differentiate the brands in a way that could work for both companies and not confuse people, since our products combine both web access and voice telephony. That’s it. Openness and clarity.

At MacWorld, Apple discussed the patents pending on their new phone technology. They clearly seem to value intellectual property. 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. And that needs to be a two-way street.

This lawsuit is about Cisco’s obligation to protect its trademark in the face of a willful violation. Our goal was collaboration. The action we have taken today is about not using people’s property without permission.

Cisco’s Press Release on this issue is here: http://newsroom.cisco.com/dlls/2007/corp_011007.html
So Cisco tried to leverage their way into a Very Good Thing™ and got spurned. That’s their side of the story, at least. If so, Cisco is having a silly hissy fit in public. Whatever.

Related articles:
Apple calls Cisco’s ‘iPhone’ trademark lawsuit ‘silly,’ says ‘very confident we’ll prevail’ – January 11, 2007
Cisco sues Apple for ‘iPhone’ trademark infringement – January 10, 2007
The only thing really wrong with Apple’s iPhone is its name – January 09, 2007
Briefly: Apple changes corporate name; Cisco expects agreement on ‘iPhone’ trademark today – January 09, 2007
Apple debuts iPhone: touchscreen mobile phone + widescreen iPod + Internet communicator – January 09, 2007

90 Comments

  1. I’m a big Mac fan but even I can see Cisco has a point. Apple can’t have it both ways with copyright and Steve’s behaviour on this is straight out of the Microsoft manual of dirty play – and all because Apple were determined to use the iPhone name in the keynote.

    Any sane court will hand Cisco a win on this one.

  2. Here’s where this is going, whether Steve, MDN, or anyone else wants it to or not:

    The Apple phone will NEVER be called “iPhone” unless a settlement is reached to Cisco’s satisfaction. The trademark belongs to them. Period.

    Steve either gets beat by Cisco or calls the gadget by some other name than the one he announced on Tuesday.

    Then, his defeat will be immortalized on the face of every Apple phone forever and ever – a billion reminders that, this time at least, Steve didn’t get his way.

  3. Uh…Apple is infringing the trademark so I’m not sure what they are thinking. both products use wifi and are called iPhone so it’s not like Apples to Oranges or whatever. What do you think will happen when Cisco puts out an iPhone that looks a little like the Apple phone, but it is just a touch screen cell phone Zune playing piece of garbage. Jobs is a little too arrogant for his own good here, I think…

  4. To Dirty …

    Who ever said the courts were sane??? ” width=”19″ height=”19″ alt=”grin” style=”border:0;” /> I am open on this one. Apple is not shipping product so how can vaporware be infringement? As MDN says, maybe this is just more negotiation efforts. ??? Maybe the name will be “apple phone” and Apple is using a known lawsuit to allow them to change the name without anyone giving them grief. Afterall, I don’t remember seeing the words “iPhone” on the phone anywhere.

    Either way in will probably be interesting, ….. in a soap opera kind of way. ” width=”19″ height=”19″ alt=”grin” style=”border:0;” /> LOL

    N.

  5. I agree with the posts above. I, too, am a huge Apple fan since 2001 when I switched platforms. However, if the scenario above is true, then Apple, Inc. is in the wrong here. Why they just didn’t call it an “ApplePhone” or something like that? Does that name possess less of a ‘cool’ factor? (I guess ‘iPhone’ sounds better than ‘ApplePhone’ — or are we just used to it from all the rumors). Too bad SJ & Co. weren’t willing to settle the details of this issue by the time of the Keynote address. I’m sure it’ll get settled by June, but I wonder why they are dragging their feet right now.

  6. I think Cisco’s view is reasonable, but it’s no slam-dunk.

    There are lots of companies using the term iPhone–just search Froogle and/or Amazon–in the VOIP space and they predated Cisco’s recent introduction. Apple can argue that their product does not infringe as much as those others b/c their phone is not VIOP.

    Courts will not be eager to hand Cisco a win against Apple if they failed to defend their rights against others.

    Apple is definitely playing fast and loose here, but as I said, Cisco’s case is not necessarily a winner.

  7. Apple needs to be careful here. How long before Skype is on the phone to prove that it does violate even Apple’s own narrow definition of Cisco’s Patent. Skype would make the Apple iPhone also perform the bulk of the Cicso product’s functions. Apple should either make a fair deal with Cisco to share the trade mark or call it the Apple Phone.

    If apple prevails and sets such a narrow precedence on trademark restrictions, then it may face encroachment on their own trademarks. Don’t get me wrong, I am the biggest Apple fan (evangelist) out there, but sometimes even the best make mistakes. In this case Apple is in the wrong. Cisco should make a very concerted effort to be fair as their own iPhone will get much more publicity from it being mistaken for the more popular Apple product.

  8. As usual, MDN attacks anything and anybody that dares to challenge Apple or say anything negative about apple. Whatever you all the stuff on this web site, you sure can’t call it journalism!

    This quote says it all for me:

    “We know the answer – Apple is a very aggressive enforcer of their trademark rights. And that needs to be a two-way street.”

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