Storage rivals, Quantum and Sun Microsystems subsidiary, StorageTek, have settled their three-year patent dispute and entered into a cross-licensing agreement.
Under the terms of the deal, the two vendors will have license to a limited number of each other's patents on a non-exclusive, worldwide basis. Quantum has also agreed to pay Sun $US20 million this quarter and an additional $US5 million over the next five quarters.
In April 2003, StorageTek filed a suit charging that Quantum's SDLT tape drives and media products used technology that infringed two of StorageTek's patents. The suit sought an injunction against the sale of these products and monetary damages of $US142 million.
Sun acquired StorageTek in August 2005. The case against Quantum was set to go to trial this week.
Quantum agreed to settle after weighing the benefits of the licensing agreement against the legal costs it could incur and the potential damage on its business if it were to lose in court, according to a statement from Rick Belluzzo, chairman and chief executive officer of Quantum, based in San Jose, California.