Now Cisco released a statement saying that they sue Apple for trademark infringement.
Cisco obtained the iPhone trademark in 2000 after completing the acquisition of Infogear, which previously owned the mark and sold iPhone products for several years. Infogear's original filing for the trademark dates to March 20, 1996.
Cisco entered into negotiations with Apple in good faith after Apple repeatedly asked permission to use Cisco's iPhone name," said Mark Chandler, senior vice president and general counsel, Cisco. "There is no doubt that Apple's new phone is very exciting, but they should not be using our trademark without our permission."
"Today's iPhone is not tomorrow's iPhone. The potential for convergence of the home phone, cell phone, work phone and PC is limitless, which is why it is so important for us to protect our brand," Chandler concluded.
Apple response is that they think the lawsuit is silly. See quote below. "We think Cisco's trademark lawsuit is silly," Apple spokesman Alan Hely said. "There are already several companies using the name iPhone for Voice Over Internet Protocol (VOIP) products."
"...We are the first company to ever use the iPhone name for a cell phone, and if Cisco wants to challenge us on it we are very confident we will prevail." Source BBC News.
It is not clear what Cisco wanted from Apple for the use of the iPhone trademark. Apparently Apple did not want it to give it to them. With a lawsuit that has to be dealt with under time pressure to not miss the June iPhone launch date the result in my opinion will be that Apple has to pay truckloads of cash to Cisco.