Cisco explains its decision to sue Apple

Cisco explains its decision to sue Apple

Summary: Mark Chandler, Cisco's senior vice president and general counsel, blogs about Apple's infringement of Cisco's iPhone trademark. Following is the post, with my bolding:Today’s announcement from Cisco regarding our suit with Apple over our iPhone trademark has spurred a lot of interesting questions.


Mark Chandler, Cisco's senior vice president and general counsel, blogs about Apple's infringement of Cisco's iPhone trademark. Following is the post, with my bolding:

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 substantive communications 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.

Chandler talks about having openness and clarity in sharing the iPhone brand and collaborating with Apple, but that seems like tough pill for Apple to swallow. Apple is not a sharing kind of company and is hesitant to associated itself closely with other brands, other than in partnerships around the edges. It also wouldn't be easy to have much clarity with various competing products sharing the same name. For example:


Topic: Apple

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  • It's time for Cisco to OWN Apple

    What an arrogant asshole Jobs is!
  • "we want a corner of your sandbox"

    > Fundamentally we wanted an open approach.
    > We hoped our products could interoperate in the
    > future. ... Our goal was to take that to the
    > next level by facilitating collaboration with
    > Apple.

    In other words, [b]CISCO wanted the opportunity to piggyback on Apple's ownership of the "cool handheld toy" space.[/b] Who could blame them? Who [u]wouldn't[/u] want their name to be associated with, to be said in the same sentence with, Apple?

    That, it seems to me, was the real price for the trademark, and Apple wasn't willing to pay it. As you say later in the post, Apple has a history of going it alone.
    • Except...

      Except Cisco already has an iPhone product on the market already and Apple's is six months from reality, a concept still, isn't it the other way around, Apple would have to piggyback Cisco and Apple's mantra is that they don't piggyback anyone if they can get away with it.
    • wtf

      'we want a corner of your sandbox'

      Oh, come on. Cisco does not NEED to have a corner of Apple's sandbox. This is simply an issue of one company not respecting what another company owns. Let's not all try to read too much into this.
      Geek the Gray
    • Arrogance totally on Apple's part, as usual

      The response by GDF, is typical of mentality of Apple Nerds. Jobs has used this method for years, as a means of trying to create technical superiority, and succeeded. However serious and successful he may be, it appears that the IPhone will be called something else. This goes beyond arrogance. I am not a Cisco fan, but technologically speaking Cisco has been the state of the art in the internet communications and network field for many years, and constantly proves why. They created the name, they own the name and Apple does not! End of story!
      • they did NOT create the name btw...

        They did not create that product or that name, they bought out a company that did. That company created it before iPod was launched, but not iMac. Either way, Apple is iWrong.
  • name it somethig else "THE"-Phone

    "O"-phone (only phone)

    or just "I-fon"
    • or maybe something more subtle..

      like the CISCOSucks Phone, or maybe the A Whole Phone.
    • they should call it iPwn

  • For some reason, this reminds me of

    an old joke.

    Guy walks into a bar, sees a really attractive young woman at the bar. His hormones speak to him, and say he must have her, asap. He chats her up a bit, then proposes that they retire to his place to hook up.

    She reacts badly. So, he asks her:

    "Would you sleep with me for a million dollars?"

    She hesitates, then agrees and stands to leave with him.

    He then asks, "Well, how about ten bucks?"

    "What do you think I am!?" she exclaims, and sits back in the barstool.

    To which he responds with the relevant punch line "We've already determined what you are. All we are doing now is negotiating the price."

    According to his blog, the two companies were in serious discussions on this idea that they could share the iPhone label. Steve Jobs, yes, arrogant SOB that he is, jumped the gun. His arrogant nature, or the idea that he may in fact be more of an asshole than you or I is kind of beside the point. The idea that a successful conclusion to these discussions was imminent is not completely unreasonable, and is - I am guessing - what SJ was banking on.

    He ought to be able to argue he had a reasonable expectation that the discussions would conclude successfully, that what he was doing was simply anticipating the success of those discussions, and MacWorld wouldn't roll around again until after the release of the product. As was mentioned in the coverage of the announcement, he had regulatory concerns that demanded a premature announcementof product.

    As far as the openness, or lack thereof, surrounding the Apple iPhone, well, the nature of Apple's approach to systems isn't unknown among many. As far as tech industry professionals go, I would say that number is even smaller.

    The idea that Cisco might reasonably expect Apple to change it's whole business approach for them is a bit naive. I would not expect that to happen, but maybe it's more open to negotiation now.

    I suppose if it gets Apple some added coverage, and that sales of the product meet or beat projections, well... both companies have lawyers on staff, anyway, right? SO, a successful product launch, accompanied by some "bad" press, is still a successful product launch, right?

    Do you wonder if this suit is more for show than anything else?
  • Enough Stupidity to go around....

    In this wide world of language, Apple is they are truly creative as they claim they are, can come up with something catchy like the iPod for the phone. Nah....They would have to be arrogant and dumb and Cisco, for their part would compete on equal footing in the dumb department.
  • Piggy-back?!

    Urrrr...? They are two different products. One is essentially a HOUSE phone and the other is a CELL phone. Who really gives a crap about house phones? Where is the money? Simple, mobile media and last I checked, VoIP phones (house phone) is about as interesting as watching a Windows Default screen savers.

    I fail to see how Apple would be piggy-backing on CISCO. CISCO is just pissed because they want to make money off of someone else's product/success. Personally, I'd change the name and let CISCO bum a piggy-back ride somewhere else.

    Nothing but haters.
  • Hello, Pot? This is Kettle

    It's hard to stomach that a company that is as protective of its IP as Apple would not show the same respect to Cisco.

    That said, what Apple did may have violated the letter of the law, but judging by the photo of that Linksys phone, Cisco has clearly violated the spirit of the law. From the glossy-white finish to the lowercase "i", it's pretty clear what Linksys was trying to do. To be honest, I'm surprised Apple hasn't already taken legal action against Cisco for this blatant design rip-off. Lord knows that in the past, Apple has taken action against others for even less product similarity.

    At the same time, how can Cisco claim trademark infringement when we don't even know for sure what the name of the product will be by the time Apple releases it to market? Case in point: the Nintendo Revolution (Wii), or the Apple iTV (AppleTV).
    • Why it is trademark infringement

      [i]At the same time, how can Cisco claim trademark infringement when we don't even know for sure what the name of the product will be by the time Apple releases it to market?[/i]

      Because Jobs announced the product to the general US public refering to it by a US trademarked name, the law sees this as endeavouring to pass off your product under someone elses trademark. That in and of itself consitutes clear cut trademark infringement.

      Apple couldn't hope to defend that infraction, their only course of action is to attempt to persuade the court that the two products are sufficiently different or that Cisco has abandoned their trademark.

      I suspect either would be difficult to acheive but neither is impossible.

      My guess, settlement prior to any court hearing.
    • Which came first, the iChicken or the iEgg?

      Look at the dates...
      Cisco have owned the trademark name iPhone (with lowercase "i") since before Apple brought out the iPod, so why shouldn't they put it on their products?

      Don't get me wrong - I love Apple products. I have iPods and a mini iMac. Their technology is fantastic...

      But their arrogance in this is simply unbelievable - just last September they were threatening anyone who used "pod" in their product name... Lawyers for Apple contended that the term 'pod' has been used by the public to refer to Apple's music player so extensively that it falls under Apple's trademark protection.

      Seems to me what goes around comes around? Good for Cisco - someone has given the school bully a bloody nose!
      Rising Star
  • Launch name maybe different

    Yes, Apple have called it the iPhone in the presentations this week. It is the name we all expected and have used in conversations and in writing. As such it made sense in the 'marketing' keynote this week.

    However, until the product is launched I am not assuming it will be called the iPhone. An amazing change of name could happen over the next 5 months. We whould wait and see.
    • i can almost guarantee it...

  • Overlooking the Obvious

    Why is everybody trying to make more of this than it is? It is a fact that Cisco has owned this trademarked name since 2000. It is also a fact that Apple used this trademarked name on a newly announced product at a very public trade show without the permission of the actual trademark owner, hence a willful and deliberate violation of federal trademark laws. Despite the wishful thinking of millions of Apple fans, Apple is wrong here and the trademark owner is calling them on it. And given Apple's behavior over their intellectual property in the past, I can't say that they don't deserve a little payback. I for one am glad to see that what goes around comes around.
  • So, change the name

    to Newton.

    I think Apple still owns that one. Add OCR and whatever else that device had that this one doesn't already have, and you are good to go.

    Or, maybe Cisco returns to the table and they work it out.

    Either way, it's the device that will make or break this move, not the name. If Apple produces a product of sufficient quality, all of this will be as relevant as a bunch of 1s and 0s on a chat server somewhere...
  • Apple just needs to give up and die.

    Apple survives today only because of the iPod. Not that the iPod is that great, in fact it's functionally and technically similar to every other portable multimedia device available today. Considering most others are much less in cost, Apple only continues to hold the market due to human vanity alone. iPod is only popular because Apple made a few neat commercials at the beginning of it's market debut. Big deal.

    If it weren't for the iPod, Apple would most likely have filed for bankruptcy protection long ago. Would the world be different without Apple today? Not likely. If anything mabey digital copy rights would be easier to understand, as the iPod definately has not helped in that arena one bit.

    Apple was a great company in the 1980's. It ain't the 80's any more.