Both companies sought patents on the software, but Apple's was denied, while Creative's was granted. Creative then sued Apple for infringement and to stop the import of iPods which are manufactured in China ( see the NY Times article here).
This settlement again challenges the whole idea of software patents. Who pays? The consumer. Microsoft does not need a patent on Windows to keep out competition. It protects its technology by secrecy. But what is original and unique about a set of menus in simple, perhaps obvious processes using a set of related menus? Why then could Creative go home with the profit? Probably because Apple was concerned that its iPod source would be blocked and its highly profitable sales of music downloads for the iPod, said to be its biggest source of profits, jeopardized. And that its own software patents would be threatened if they generally came under attack. Remember,as well, "the International Trade Commission was conducting an inquiry into the dispute but this is now expected to end."
