Apple has agreed to pay Creative Technology $100 million dollars to settle all legal disputes between the two companies, and for a license to use Creative’s recently awarded “Zen” patent in all Apple products.US Patent 6,928,433 covers “A method, performed by software executing on the processor of a portable music playback device, that automatically files tracks according to hierarchical structure of categories to organize tracks in a logical order. A user interface is utilized to change the hierarchy, view track names, and select tracks for playback or other operations.”

Apple can recoup a portion of its payment if Creative is successful in licensing this patent to others. The companies also announced that Creative would participate in Apple’s Made for iPod program.

“Creative is very fortunate to have been granted this early patent,” said Steve Jobs, Apple’s CEO. “This settlement resolves all of our differences with Creative, including the five lawsuits currently pending between the companies, and removes the uncertainty and distraction of prolonged litigation.”