Apple faces ban on iPod sales in the US

Stuart Corner
Thursday, 15 June 2006 12:21

IT Industry - Strategy

The US International Trade Commission has voted to institute an investigation of Apple Computer over claims by Creative Technology, developer of the Zen and Nomad MP3 player, that iPod infringes  its US patent which Creative refers to as the 'Zen Patent'.
The investigation follows a complaint filed with the ITC by Creative Labs of Milpitas, CA, and its parent company, Creative Technology of Singapore on May 15 2006. Creative has requested that the ITC issue a permanent exclusion order and permanent cease and desist order that would prevent Apple importing and selling any of is iPod models in the USA.

According to Creative, the case will be referred to the ITC administrative law judge, Paul J Luckern who will hold an evidentiary hearing, at sometime between five to eight months  hence and will make an initial determination. This will be subject to review by the Commission, which according to Creative,  usually issue its ruling in 12 to 15 months of the institution of the investigation.

Creative has also lodged patent claims against Apple.  However a decision from the ITC is generally faster, but will not influence the patent court.

Creative released its Nomad MP3 player in April 1999, two and a half years before release of the first iPod in October 2001.  It applied for the Zen Patent in January 2001 and was granted it in August 2005.

Creative's filing  claims that before the launch of the first iPod, when its Nomad device was already on the market, Apple approached Creative with a view to collaboration on MP3 players, but after some discussions, "abruptly indicated that there was not enough financial room in the portable digital player market for two companies with margins stacked one on top of one another" and proposed Creative licence its technolog to Apple or spin it off into a separate company in which Apple would invest.  Creative declined.

Craig McHugh, president of Creative Labs, hosted a pres teleconference  on the Zen Patent held on 30 August 2005 in which he claimed that ."The ZEN Patent was awarded to Creative for our invention of the user interface for portable media players, including many of the Creative Zen and Nomad Jukebox MP3 players and found in some competing players such as the Apple iPod and iPod mini.

He claimed that "the user interface covered by the Zen Patent was invented by research and development engineers at our Advanced Technology Center in Scotts Valley, California. After a major investment of time and effort by a group of our research and development engineers, they developed a user interface that enables users of portable media players to efficiently and intuitively navigate and select tracks on a portable media player."