Adobe, Macromedia Kiss and Make Up

Two Silicon Valley software rivals decided to settle their outstanding patent lawsuits Monday after several years of backbiting accusations.

In a joint statement, San Francisco-based Macromedia and San Jose, Calif.-based Adobe Systems said they have put aside their legal differences on “all litigation.” Terms of the settlement were kept very confidential.

The Web graphics and publishing software makers said customers with products from either Adobe or Macromedia would not be affected by the settlement.

The companies had been scheduled to go to trial in June 2003 over still another patent infringement suit.

The two software makers have a bitter history concerning patents. The various disputes cover everything from Web graphics programs to video editing tools and other technologies.

The largest spat involved U.S. Patent No. 5,546,528, granted in 1996. This covers Adobe’s “tabbed palette” patent, which is Adobe’s user interface for displaying multiple sets of information on the computer screen.

The tabbed palette allows a user to manage and customize multiple layers of image data within a screen while working on a design. Before the palette’s invention in 1994, an artist using Adobe’s image products had to have several palettes (think digital easels) open throughout the screen in order to work. The tabbed palette allowed designers to take their palettes and “lay” them on top of each other inside of a small window, freeing up screen space, and allowing users to switch between palettes by hitting tabs along the top of the screen.

Adobe’s suit at the time said Macromedia was given no right to employ such technology, which the plaintiff claims is scheduled to roll out as a feature in Macromedia’s Flash 5.0 software. Macromedia counter-sued a few hours later.

In May, a jury ruled in favor of Adobe resulting in $2.8 million. In a different patent infringement suit lawsuit settled that month, Macromedia won $4.9 million from Adobe.