Under the long-term agreement, the two telecommunications equipment makers will cross-license their patented technologies and drop lawsuits that they have against each other, the companies said Tuesday. No further details on the terms of the deal were disclosed.
The settlement ends ain federal district court in Eastern Texas that alleged Nortel had infringed on six of its patents.
Three of the patents involved Ciena's Asynchronous Transfer Mode switching features, while two focused on its wave division multiplexing technology. A sixth patent centered on Ciena's Sonet technology. Nortel subsequently filed its own patent lawsuit against Ciena.
The settlement marks the latest legal wrangling between the two companies, which dates back to 2002.
Nortel had filed a patent infringement, which was later acquired by Ciena.
In 2003, Ciena and Nortel reached a settlement in the ONI case, resulting in a $25 million payout to Nortel and an agreement to license some of Nortel's patents. The parties agreed to forgo suing each other for a two-year period while they worked out a cross-licensing agreement, but Ciena then sued Nortel last year. That case is now closed with the announced settlement.