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Cisco claims Apple used phony company to get name

As you've probably heard by now, Apple neglected to secure the rights to the iPhone name from Cisco before the big announcement yesterday. Today, Cisco sued. What happened? Cisco claims Apple "surreptitiously" attempted to gain access to the name in the US through a fake company.
Written by Ed Burnette, Contributor on

As you've probably heard by now, Apple neglected to secure the rights to the iPhone name before the big announcement yesterday. Last night, Cisco was willing to give Jobs the benefit of the doubt, saying that they were simply waiting for Apple to sign the documents that would allow them to use the name. But today, Cisco sued. What happened?  In the lawsuit, Cisco alleges:

18. Apparently dissatisfied with Cisco’s refusal to allow Apple to use the mark iPhone for products that would conflict directly with Cisco’s current use of the mark, Apple began a surreptitious effort to attempt to obtain rights to use the name “iPhone” in connection with the very products, telephones using cellular voice and data networks, for which it had asked Cisco for rights.

19. On September 26, 2006, an entity calling itself Ocean Telecom Services LLC filed an Intent to Use (ITU) application for the mark iPhone pursuant to 35 U.S.C. § 1051(b). A copy of the application is attached as Exhibit C.

20. The Ocean Telecom application claimed a priority date of March 27, 2006, pursuant to 35 U.S.C. § 1126(d), based on the filing of application number 37090 in Trinidad and Tobago.

21. On September 19, 2006, Apple filed an application to register the trademark iPhone in Australia. The IP Australia record reflecting this application is attached as Exhibit D.

22. Like the Ocean Telecom application, Apple’s Australian application claimed a priority date of March 27, 2006, based on the filing of application number 37090 in Trinidad and Tobago.

23. The goods and services description in the Ocean Telecom ITU application is practically identical to the description found in Apple’s Australian application.

24. Upon information and belief, Ocean Telecom Services LLC is owned or otherwise controlled by Apple and is the alter ego of Apple.

I did a little digging on Ocean Telecom Services LLC. In the trademark application the company's address is:

Ocean Telecom Services LLC
Corporation Trust Center, Room 123
1209 Orange Street
Wilmington, DE 19801

While a company called Ocean Telecom does have a web site, they are based in the UK and are probably unrelated to the filing. There is no company with a name like "Ocean Telecom" listed in the white pages for Wilmington Delaware, nor in the Better Business Bureau database. However that address is registered to a company called "CT Corporation". Looking at their web site, one of the things CT Corporation does is act as a registered agent:

Appointing a registered agent is more than a statutory requirement. It's also an essential business relationship that helps your company avoid default judgments and remain in good standing. Your registered agent ensures that every legal document - whether it's a lawsuit or a notice from the state - gets into the right hands quickly and efficiently.

From all this, it appears somebody set up a corporation that exists on paper only, hired CT Corporation to act as their registered agent so they could get official mail, and then used the paper corporation to file a trademark application for "iPhone". One that looks remarkably similar to an application that Apple filed in Austrailia. Smell fishy to you? Cisco thinks so.

You may wonder, is Cisco doing this just to try to get more money from Apple? They claim that all they want is interoperability. In the company blog, Mark Chandler, Cisco's SVP and General Counsel writes:

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.

Sounds good to me, though Apple's carrier partner Cingular may have objected to those terms. Cisco's VOIP products compete with traditional cellular service provided by vendors like Cingular.

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