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Apple pays $5 million to settle Elan patent lawsuit

If patent infringement lawsuits are the soap operas of the tech industry, the news that Apple has paid out $5 million as part of a settlement to Taiwanese company Elan Microelectronics might qualify as a “shocking twist.”

Elan sued Apple way back in April of 2009, alleging that Cupertino had infringed upon two of its U.S. patents covering touch-based technologies. That suit requested that the U.S. government prevent Apple from building or selling iPhones, iPod touches, and MacBooks.

In addition to the $5 million payday, the settlement also gives Elan and Apple the ability to use each other’s patents—an agreement that is potentially far more valuable than the sheer monetary award, which comes to a tiny fraction of a percent of Apple’s extensive cash holdings. Rumors of a settlement first surfaced early last year, with Elan denying it had received a $100 million proposal from Apple.

Elan had also asked the U.S. International Trade Commission to ban imports of potentially infringing Apple products. But, after an investigation, the ITC ruled last May that Apple did not infringe upon Elan’s technology. That decision may have prompted Elan to settle rather than continue to pursue the case.

While this removes one case from Apple’s docket, the company has plenty more ongoing litigation, especially in the realm of intellectual property. Elsewhere, it’s engaged in fierce legal battles with mobile device makers Samsung and HTC, among others.


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