"iPhone" ignites trademark battle between Apple and Cisco

Merely a day after the launch of its eagerly awaited mobile phone, called iPhone, at the annual Macworld conference and Expo in San Francisco, Apple Inc. got sued over the new gadget’s name.

Cisco Systems on Wednesday announced that it has filed a lawsuit in the United States District Court for the Northern District of California against Apple, Inc for using iPhone trademark that is already obtained by Cisco.

The San Jose, California based giant networking company said it succeeded to secure the iPhone trademark for itself after acquiring Infogear Technology Corp., which previously owned the trademark and sold iPhone products for several years, in a stock deal worth US$301 million in 2000.

Infogear, which specialized in Internet appliances, originally filed for the trademark on March 20, 1996. Linksys, a networking division of Cisco, has been shipping a new family of iPhone products since early last year. It expanded the iPhone family on Dec. 18 by adding some more products to it.

In its lawsuit Cisco accused of iPod maker of copying and using Cisco's registered iPhone trademark intentionally. Cisco is seeking to prevent Apple from using the name as well as damages from the company.

“Cisco entered into negotiations with Apple in good faith after Apple repeatedly asked permission to use Cisco's iPhone name,” said Mark Chandler, senior vice president and general counsel at Cisco. “There is no doubt that Apple's new phone is very exciting, but they should not be using our trademark without our permission.”

Both companies were close to finalizing a deal on Monday night that would have allowed both Cisco and Apple to use the iPhone name, but the companies left the negotiating table at 8pm on Monday with only a few points left to negotiate, Chandler said in an interview.

And, without completing the deal on the 'iPhone' name, Apple chief executive Steve Jobs launched the new "iPhone" on very next day, he added.

On the other hand, Apple’s spokeswoman Natalie Kerris called Cisco's lawsuit "silly," and said a number of companies are already using the name iPhone for voice over IP (internet protocol) products.

"We're the first company ever to use iPhone for a mobile phone. If Cisco wants to challenge us on it, we're confident we'll prevail," Kerris said.

After the reports of trademark lawsuit shares of Apple were slipped by 49 cents to close at $96.51 in after-hours trading. Apple shares have jumped 13.5 per cent on the NASDAQ Stock Market since the iPhone announcement Tuesday.