Apple, Burst.com settle patent infringement case

After falling off the radar for a while, the Apple v. Burst.com case has been moving along quite rapidly in the past month or so. Earlier in November, a judge dismissed 14 of Burst.com's infringement claims, and both sides seemed to be preparing for a trial date in February. As it turns out, the parties were also looking for other options, apparently including settling the case before the trial. On Wednesday, the two companies agreed to a preliminary settlement agreement, effectively ending Burst.com's original suit and Apple's countersuit.

Under the terms of the agreement, Apple will pay Burst.com a one-time $10 million licensing agreement, granting it access to most of Burst.com's patent portfolio. The cash settlement also gives Apple immunity from lawsuits related to new Burst.com DVR patents. Burst.com's board still has to approve any final settlement agreement. $10 million is a pretty good deal compared to the $60 million Microsoft paid Burst.com, and it appears to be far less than what a damages figure based on iTunes usage and iPod sales would have been.

The proposed $10 million settlement translates into roughly $4.6 million for Burst.com once the attorneys and various other fees have been taken care of. In the past, Burst.com has paid out settlement proceeds to shareholders as a dividend, and the same will probably happen with Apple's licensing fee.

In the past, Burst.com has said that they will continue to aggressively enforce their patent portfolio, which seems to have turned into their new business model. Now that both Microsoft and Apple have paid to license Burst.com's patents, it's likely that we'll see more patent lawsuits from Burst.com in the future.