Apple Drops "App Store" Trademark Suit Against Amazon

Apple vs. AmazonApple dropped its long-running case against Amazon over its "APP STORE" trademark. Apple sued Amazon in March of 2011 after the online retailing giant launched the Amazon Appstore for Android, claiming that it violated Apple's trademark.

In court filings, Apple argued that Amazon's use of its trademark, "will confuse and mislead customers." For its part, Amazon argued that it was a generic term that didn't deserve trademark protection. The company noted that Apple's own executives, including Steve Jobs, had used the term generically in keynote presentations and media events.

The case persisted and was scheduled to go to trial on August 19th, but on Tuesday, Apple dropped its claims and U.S. District Judge Phyllis Hamilton officially dismissed the case.

"We no longer see a need to pursue our case," an Apple spokesperson told Reuters. "With more than 900,000 apps and 50 billion downloads, customers know where they can purchase their favorite apps."

For those keeping score at home, that statement can be dismissed as corporate posturing. While Apple has indeed won the app ecosystem game and Amazon's Appstore for Android is lacking, Apple wouldn't have dropped the case if it thought it could win.

For its part, Amazon took a more aggressive stance, with a company attorney telling Reuters, "This was a decision by Apple to unilaterally abandon the case, and leave Amazon free to use 'appstore.'"

An Amazon spokesperson added, "We're gratified that the court has conclusively dismissed this case. We look forward to continuing our focus on delivering the best possible appstore experience to customers and developers."

Many criticized Apple's lawsuit when it was launched in 2011 as unnecessary aggression. From our viewpoint, Amazon was clearly trying to glom on to Apple's success, but that doesn't necessarily translate into victory in court.

The reality is that it was Apple's own success with "The App Store" that made the term generic, dooming the company's attempt to defend its trademark.

Shares of both companies rose on Tuesday. $AAPL closed at $422.35, a gain of $7.30 (+1.76 percent), on moderately light volume of 12.6 million shares trading hands.

Shares of $AMZN closed at $291.53, a gain of $0.94 (+0.32 percent), on moderate volume of 2.8 million shares.