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will pay EMC
$325 million under an agreement that settles patent infringement allegations between the two data storage companies.
HP can satisfy its payment to EMC through the purchase for resale or internal use of complementary EMC products, such as the VMware product line, over the next five years.
EMC and HP also have signed a five-year patent cross-license agreement to bolster their mutual information lifecycle management strategies for managing data from cradle to grave, confirmed EMC spokesman Mark Fredrickson.
The companies have yet to finalize the details of those future business arrangements. Fredrickson said EMC hoped the deal was the beginning of a new chapter in the relationship between the two competitors.
"We've always taken our patents very seriously," Fredrickson said in an interview. "We have technology in both hardware and software with very important patents that underpin that technology, and we need to be vigilant in defending them."
The settlement effectively ends four years of contentious litigation with no findings or admissions of liability, he said, noting that the resolution covers three cases going back to 2001.
EMC originally filed a patent infringement suit against StorageApps, which HP acquired in 2001 for $350 million. When HP consummated that deal, it also bought into the lawsuit, which went all the way to trial.
EMC won a permanent injunction against HP, precluding the Palo Alto, Calif., company from using StorageApps' Continuous Access Storage Appliance, Fredrickson said.
HP then sued EMC in September 2002, claiming the storage specialist had infringed seven HP patents. EMC countersued later that day with infringement claims of its own.
The seven patents in HP's suit against EMC cover powering storage systems; transferring data between different storage formats; connecting servers to storage systems; presenting storage system details to servers; improving how arrays of hard drives read and write data; and coping with disk failure.
HP allegedly infringed on EMC's patents for software that mirrors data onto different storage systems. The countersuit also covered technology for storing data from mainframe computers and software that moves data from one storage system to another.
In the last legal salvo, HP last fall filed another suit asserting the same patents, attempting to apply them to newer EMC products.